345 2012 MT with answers

Realer smaller d smaller ureater j 5 the return

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Unformatted text preview: smaller. "' ureater J 5. The return on a 8% coupon bond that is initinJJy bought for $1000 and is sold for $900 a year later is: a l -10% b.) -2% c) d) 0% 2% 16. The annualized return on a $1000 par value. 10 year. 10'!,0 coupon bond thill is initially bought for $1400 nnd is hdd to maturity is: exactly 10% b) greater tlwn 0%, but h:ss th an I O"·o c.) greater than I0% but Jess than 20"1J d.) 0% or less a J 17. If a discount hond was actually bought by an investor at its face (par) va lue, then the return on thi s investment would be: I\ 0% exactly 0% greater than 0% a.) less than b .) c.) I R. For whi ch one of the followin g is the current rield the most accurate representation of the tmc yield on the bond? -- a l yea r bond h ) a 5 yea r bond c) a 10 year bond <.L) a 30 year bond a .) 19. If interest rates are forecast to ri se by a fixed amoun t fo r the indefi nit e future, the pri ce of a 5yea r bond wi II _ _ by than the pri ce of a !-yea r bond . rise, more ri se...
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