PT Ch15

PT Ch15 - Exam Name MULTIPLE CHOICE Choose the one...

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Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Which of the following statements about TIPs is TRUE? 1) A) TIPs refer to Treasury inflation protection securities. B) The Treasury has issued TIPS that are notes and bonds. C) TIPs adjust for inflation. D) All of these 2) In January 1999, the structure of the government bond market changed with the start of ________ enabling the Euro government bond market to become the largest government bond market in the world in terms of size and number of issues. 2) A) the British Monetary Union (BMU) B) the Swiss Monetary Union (SMU) C) the European Monetary Union (EMU) D) the Russian Monetary Union (RMU) 3) Because of the possibility of disinflation (i.e., price declines), the inflation - adjusted principal at maturity may turn out to be less than ________ value. However, the Treasury has structured TIPS so that they are redeemed at the ________ the inflation - adjusted principal and the initial par value. 3) A) the initial market; lesser of B) the initial par; greater of C) the initial market; greater of D) the initial par; lesser of 4) There are four methods that have been used in distributing new securities of central governments. Which of the below is NOT one of these? 4) A) One of these is the regular calendar auction/Dutch - style system. B) One of these is the ad hoc auction system. C) One of these is the regular calendar auction/minimum - price offering system. D) One of these is the top system/maximum - price offering system. 5) ________, governments announce auctions when prevailing market conditions appear favorable. 5) A) In the regular calendar auction/Dutch - style auction system B) In the regular calendar auction/minimum - price offering system C) In a tap system D) In the ad hoc auction system 6) The yields on ________ government bonds are viewed as benchmark interest rates in Europe. 6) A) Japan B) German C) England D) U.S.A. 7) In regards, to the auction for Treasury securities, which of the below statements is FALSE? 7) A) The auction results are determined by first deducting the total noncompetitive tenders and nonpublic purchases (such as purchases by the Federal Reserve itself) from the total securities being auctioned. B) Bids are arranged from the lowest price to the highest price. C) Noncompetitive tenders may be submitted for up to a $1 million face amount and are based on quantity, not yield. D) The highest yield accepted by the Treasury is referred to as the stop yield, and bidders at that
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PT Ch15 - Exam Name MULTIPLE CHOICE Choose the one...

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