21. What happens to a discount bond as the time to maturity decreases? A. The coupon rate increases. B. The bond price increases. C. The coupon rate decreases. D. The bond price decreases. E. None of above 22. Which one of the following is fixed for the life of a given bond? A. Current price B. Current yield C. Yield to maturity D. Coupon rate E. None of above 23. What is the minimum amount shareholders should expect to receive in the event of a complete corporate liquidation? A. Market value of equity B. Book value of equity C. Shareholders may be required to pay to liquidated D. Zero E. None of above 24. A zero-coupon bond is always a discount bound. A. True B. False 25. The weak form of the efficient market hypothesis implies that: A. No one can achieve abnormal returns using market information. B. Insiders, such as specialists and corporate board members, cannot achieve abnormal returns on average. C. Investors can achieve abnormal returns, on average, using technical analysis, after adjusting for transaction costs and taxes. D. The market is inefficient. E. None of above.
21. What happens to a discount bond as the time to maturity decreases? A. The coupon rate increases. B. The bond price increases. C. The coupon rate decreases. D. The bond price decreases. E. None of above 22. Which one of the following is fixed for the life of a given bond? A. Current price B. Current yield C. Yield to maturity D. Coupon rate E. None of above 23. What is the minimum amount shareholders should expect to receive in the event of a complete corporate liquidation? A. Market value of equity B. Book value of equity C. Shareholders may be required to pay to liquidated D. Zero E. None of above 24. A zero-coupon bond is always a discount bound. A. True B. False 25. The weak form of the efficient market hypothesis implies that: A. No one can achieve abnormal returns using market information. B. Insiders, such as specialists and corporate board members, cannot achieve abnormal returns on average. C. Investors can achieve abnormal returns, on average, using technical analysis, after adjusting for transaction costs and taxes. D. The market is inefficient. E. None of above.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:21. What happens to a discount bond as the time to maturity decreases?
A. The coupon rate increases.
B. The bond price increases.
C. The coupon rate decreases.
D. The bond price decreases.
E. None of above
22. Which one of the following is fixed for the life of a given bond?
A. Current price
B. Current yield
C. Yield to maturity
D. Coupon rate
E. None of above
23. What is the minimum amount shareholders should expect to receive in the event of a
complete corporate liquidation?
A. Market value of equity
B. Book value of equity
C. Shareholders may be required to pay to liquidated
D. Zero
E. None of above
24. A zero-coupon bond is always a discount bound.
A. True
B. False
25. The weak form of the efficient market hypothesis implies that:
A. No one can achieve abnormal returns using market information.
B. Insiders, such as specialists and corporate board members, cannot achieve abnormal
returns on average.
C. Investors can achieve abnormal returns, on average, using technical analysis, after
adjusting for transaction costs and taxes.
D. The market is inefficient.
E. None of above.
8
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