FIN 355 Quiz 3 New Work
FIN 355 Quiz 3 NEW
Bonds issued by state and local governments to fund private projects are called
You assess that one-year and three-year zero-coupon bonds are priced correctly but a two-year zero-coupon bond is overpriced. To take advantage of this mispricing, you should
A bond that has no specific collateral to support it is
If you buy a bond today, hold it to maturity, and reinvest coupons at a rate that exceeds the bond’s YTM, your realized yield will be
The yield to maturity assumes that coupons are
A fixed coupon rate bond has 12 years to maturity. After one year, its duration will become ______ and its value will become _______ sensitive to interest rate movements.
Which of the following terms cannot be associated with corporate bonds?
Bonds that are traded over-the-counter are traded
Exchange-traded bonds are
What is the duration of a 5-year zero-coupon bond if the discount rate is 6%?
Question 11 Which mortgage type dominates the mortgage markets?
Question 12 Single monthly mortality refers to
Question 13 The closed-form solution for valuing a portfolio of fixed-rate mortgages _______.
After a single national mortgage market had developed as a result of disintermediation, the 30-year fixed-rate mortgage rates _____.
Collateralized loans represent
A prepayment option on a mortgage is similar to _______ on a bond.
An adjustable-rate mortgage contract should specify all but one of the following:
The interest in the asset held by the lender is called
Computing a mortgage portfolio’s expected P&I payment is based on all but one of the following:
All else equal, if interest rates unexpectedly increase, the actual cash flow of a variable-rate mortgage portfolio is likely to be _______ the expected cash flow.