Question

1. You own a bond that will pay 10% per year for the next 10 years, on a principal of $1000. The prevailing discount rate is 10% throughout. What is the bond value?

A. $2000. B. $500 C. $1100 D. $ 1000

2. A bond with a coupon rate of 6% and pays interest semi-annually. The face value of the bond is $1000. It has six years to mature. What is the bond prices when the discount rate is 5%?

A. $1050.78 B. $1051.29 C. $ 950.23 D. $1034.28

3. if a return distribution tends to get a few great losses with more frequent small gains, then:

A. this distribution is negatively skewed B. this distribution's mean is large than its median C. this distribution is symmetrical

4. which of the following example is a sampling error?

A. the differences between the sample mean and the population mean

B. the differences between the mean of sample A and sample B

C. the distribution of all possible values of a sample statistic.

5. which of the following situation is most appropriate for using t-distribution to construct a confidence interval?

A. the population variance is known, the sample size is small with a lognormal distribution

B. the population variance is known, the sample size is large with a normal distribution

C. the population variance is unknown, the sample size is small with a normal distribution

Answer 1