Concerning a corporate bond, which of the following features can change over time? a. Bond Price. b. Par value. c. How frequently coupon payments are made. d. Date the bond matures. e. Coupon rate. 14. Which one of the following statements is TRUE? a. Holding everything else constant, as the bond’s yield to maturity increases, bond price
Concerning a corporate bond, which of the following features can change over time? a. Bond Price. b. Par value. c. How frequently coupon payments are made. d. Date the bond matures. e. Coupon rate. 14. Which one of the following statements is TRUE? a. Holding everything else constant, as the bond’s yield to maturity increases, bond price
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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13. Concerning a corporate bond, which of the following features can change over time?
a.Bond Price .
b. Par value.
c. How frequently coupon payments are made.
d. Date the bond matures.
e. Coupon rate.
14. Which one of the following statements is TRUE?
a. Holding everything else constant, as the bond’s yield to maturity increases, bond price does not change.
b. Holding everything else constant, as the bond’s yield to maturity increases, bond price decreases.
c. Holding everything else constant, coupon rate increases, bond price decreases.
d. Holding everything else constant, coupon rate increases, bond price does not change.
e. None is correct.
15. If Martin observes that the risk-free rate is 1% and the market return is 9% then, according to the Capital Asset
Pricing Model (CAPM), he knows that for a stock with a beta of 1.1, the requiredrate of return will be
______%.
a. 8.2
b. 9.8
c. 11.4
d. 13.0
e. 14.6
a.
b. Par value.
c. How frequently coupon payments are made.
d. Date the bond matures.
e. Coupon rate.
14. Which one of the following statements is TRUE?
a. Holding everything else constant, as the bond’s yield to maturity increases, bond price does not change.
b. Holding everything else constant, as the bond’s yield to maturity increases, bond price decreases.
c. Holding everything else constant, coupon rate increases, bond price decreases.
d. Holding everything else constant, coupon rate increases, bond price does not change.
e. None is correct.
15. If Martin observes that the risk-free rate is 1% and the market return is 9% then, according to the Capital Asset
Pricing Model (CAPM), he knows that for a stock with a beta of 1.1, the required
______%.
a. 8.2
b. 9.8
c. 11.4
d. 13.0
e. 14.6
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