the economics of money, banking, and financial markets

91 #

© 2014 Pearson Canada Inc.#

17. 
    

    An $8,000 coupon bond with a $400 coupon payment every year has a coupon rate of
    ____.
    A) 5 percent
    B) 8 percent
    C) 10 percent
    D) 40 percent
    Answer: A
    Diff: 2 Type: MC Page Ref: 65
    Skill: Applied
    Objective List: 4.1 Understand how interest rates are measured

    
    


18. 
    

    All of the following are examples of coupon bonds except ____.
    A) Corporate bonds
    B) Treasury bills
    C) Zero coupon bonds
    D) Government bonds
    Answer: B
    Diff: 1 Type: MC Page Ref: 65
    Skill: Recall
    Objective List: 4.1 Understand how interest rates are measured

    
    


19. 
    

    A bond that is bought at a price below its face value and the face value is repaid at a maturity
    date is called a ____.
    A) simple loan
    B) fixed-payment loan
    C) coupon bond
    D) discount bond
    Answer: D
    Diff: 1 Type: MC Page Ref: 65
    Skill: Recall
    Objective List: 4.1 Understand how interest rates are measured

    
    


20. 
    

    A ____ is bought at a price below its face value, and the ____ value is repaid at the
    maturity date.
    A) coupon bond; discount
    B) discount bond; discount
    C) coupon bond; face
    D) discount bond; face
    Answer: D
    Diff: 1 Type: MC Page Ref: 65
    Skill: Recall
    Objective List: 4.1 Understand how interest rates are measured