??????2017-2018?? ?????? class No ?? ?? ?? single choice Ceach 2points total 60

Question

??????2017-2018?? ?????? class No ?? ?? ?? single choice Ceach 2points total 60 points) 1.ifaTreasury note has a bid price of SSS the oated ? price i,the wall Street lournal would be A 97:50 B 97:16 94.24 9775 2.ASS% 20year municpal bond is currently priced to yield 72% For . taxpayer in the 3s marginal tax bracket, this bond would offier an equialent taxable yield of A. 8.20% B. 10.75 E. none of the above 3. The stocks on the Dow Jones industrial Average A. havo remained unchanged sree the eation of the ides B. include most of the stocks traded on the NYE C are changed occasionally as circumstances dictate D. consist of stocks on which the investor cannot lose money EB and C 4 Which of the following securities is a money market instrument? A. Treasury note C municipal bond B. Treasury bond D. commercial paper E mortgage security 5. A put option allows the hoider to A. buy the underlying asset at the strike price on or before the expiration date. B sell the underlying asset at the strike price on or before the expiration date. C sell the option in the open market prior to expiration. D. B and C 6. Of the following types of mutual funds, an investor that wishes to invest in a divesfied portfolio of stocks worldwide (including the US) should choose E. A and C C regional funds global funds E. none of the above. A. international funds D. emerging market funds 7. An example of a derivative security is B. a call option on Mabill stock A a common share of General Motors C a commodity futures contract E. A and D. B and C 8.An ET

Explanation / Answer

1. If a treasury note has a bid price of $975, the quoted bid price in the wall street journal would be 97.16. Treasuries are quoted as a percent(%) of $1,000 and in 1/32s.97.5% * 1000=975 x/32=0.5 x=16

2. A 5.5% 20 year municipal bond is currently priced to yield 7.2% interest rate. For a taxpayer in the 33% marginal tax bracket, this bond would offer an equivalent taxable yield of 10.75%.

0.072 = rm (1-t); 0.072 = rm / (0.67); rm = 0.1075 = 10.75%.

3. The stocks on the Dow Jones industrial average includes most of the stocks traded on NYSE and are changed occasionally as circumstances dictate. So correct option is B&C.

4. Commercial paper is a money market security.

5. A put option allows the holder to sell underlying asset at strike price on or before expiration date and sell the option in open market prior to expiration. So correct option is B&C.

For rest questions, upload them as batch of 4 questions.

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