Question 1

The main reason why investors choose Canadian government securities is the above average interest rates that these securities pay.

Accepted Answer

A) True 
 B)False

Question 2

Assume that you purchased a $1,000 Rogers bond that pays 6 percent interest.What is the amount of interest you would receive each six months?

Accepted Answer

A) $6.00 
B) $3.00 
C) $60.00 
D) $30.00 
E) $1,000 
A) $6.00 
B) $3.00 
C) $60.00 
D) $30.00 
E) $1,000

Question 3

In what year were Canada Savings Bonds discontinued for sale?

Accepted Answer

A) 2015 
B) 2016 
C) 2017 
D) 2018 
E) 2014 
A) 2015 
B) 2016 
C) 2017 
D) 2018 
E) 2014

Question 4

A subordinated debenture is a more secure investment than a mortgage bond.

Accepted Answer

A) True 
 B)False

Question 5

The Canada Savings Bond Payroll Program does not allow you to save through regular payroll deductions.

Accepted Answer

A) True 
 B)False

Question 6

When a bond is selling for more than its face value, it is said to be selling at a:

Accepted Answer

A) discount. 
B) premium. 
C) commission. 
D) conservative value. 
E) prospectus value. 
A) discount. 
B) premium. 
C) commission. 
D) conservative value. 
E) prospectus value.

Question 7

A corporate bond rated AAA by the DBRS would be suitable for:

Accepted Answer

A) every investor. 
B) very cautious investors. 
C) speculators. 
D) no one because the bond issue is in default. 
E) knowledge investors. 
A) every investor. 
B) very cautious investors. 
C) speculators. 
D) no one because the bond issue is in default. 
E) knowledge investors.

Question 8

Generally, interest on corporate bonds is paid every

Accepted Answer

A) six months. 
B) three months. 
C) month. 
D) nine months. 
E) year. 
A) six months. 
B) three months. 
C) month. 
D) nine months. 
E) year.

Question 9

The yield to maturity takes into account both interest income from the purchase date until the maturity date and the difference between the purchase price and the maturity value.

Accepted Answer

A) True 
 B)False

Question 10

The current yield for a bond is determined by dividing dollar amount of annual interest by the current market value.

Accepted Answer

A) True 
 B)False

Question 11

A type of bond that is unsecured and gives bondholders a claim secondary to that of other designated bondholders, with respect to both income and assets is called a(n):

Accepted Answer

A) debenture bond. 
B) mortgage bond. 
C) preemptive bond. 
D) subordinated debenture. 
E) treasury bond. 
A) debenture bond. 
B) mortgage bond. 
C) preemptive bond. 
D) subordinated debenture. 
E) treasury bond.

Question 12

Identify the incorrect statement.

Accepted Answer

A) Canada Savings Bonds are marketable bonds. 
B) Long-term bonds embody more inflation risk than short-term bonds. 
C) A bond denominated in U.S.dollars subjects a Canadian bondholder to foreign currency risk. 
D) Bonds sold before they mature can incur capital gains or losses. 
E) Provincial bonds are relatively risk free 
A) Canada Savings Bonds are marketable bonds. 
B) Long-term bonds embody more inflation risk than short-term bonds. 
C) A bond denominated in U.S.dollars subjects a Canadian bondholder to foreign currency risk. 
D) Bonds sold before they mature can incur capital gains or losses. 
E) Provincial bonds are relatively risk free

Question 13

A bond that can be exchanged, at the owner's option, for a specified number of shares of the corporation's stock is called a(n) ____________ bond.

Accepted Answer

A) debenture 
B) mortgage 
C) indenture 
D) convertible 
E) subordinated 
A) debenture 
B) mortgage 
C) indenture 
D) convertible 
E) subordinated

Question 14

For government bonds, the bid price is the price that a dealer is willing to pay for a government security.

Accepted Answer

A) True 
 B)False

Question 15

Interest payments for registered bonds are mailed directly to the bondholder of record.

Accepted Answer

A) True 
 B)False

Question 16

A government security issued in minimum units of $1,000 with maturities that are less than one year is called a:

Accepted Answer

A) subordinated bond. 
B) treasury bond. 
C) treasury note. 
D) treasury bill. 
E) savings bond. 
A) subordinated bond. 
B) treasury bond. 
C) treasury note. 
D) treasury bill. 
E) savings bond.

Question 17

Mortgage bonds are agreements that pledge land, buildings, or equipment as securities for a loan.

Accepted Answer

A) True 
 B)False

Question 18

A corporate bond rated B by the DBRS would be suitable for:

Accepted Answer

A) every investor. 
B) very cautious investors. 
C) speculators. 
D) no one because the bond issue is in default. 
E) knowledge investors. 
A) every investor. 
B) very cautious investors. 
C) speculators. 
D) no one because the bond issue is in default. 
E) knowledge investors.

Question 19

Assume that you purchase a $1,000 corporate bond that pays 5.5 percent interest.What is the amount of interest that you receive each year?

Accepted Answer

A) $1,000 
B) $1,055 
C) $55 
D) $550 
E) $0 
A) $1,000 
B) $1,055 
C) $55 
D) $550 
E) $0

Question 20

Collateral trust bonds are secured, through a pledge of real property.

Accepted Answer

A) True 
 B)False

The main reason why investors choose Canadian government securities is the above average interest rates that these securities pay.

Assume that you purchased a $1,000 Rogers bond that pays 6 percent interest.What is the amount of interest you would receive each six months?

In what year were Canada Savings Bonds discontinued for sale?

A subordinated debenture is a more secure investment than a mortgage bond.

The Canada Savings Bond Payroll Program does not allow you to save through regular payroll deductions.

When a bond is selling for more than its face value, it is said to be selling at a:

A corporate bond rated AAA by the DBRS would be suitable for:

Generally, interest on corporate bonds is paid every

The yield to maturity takes into account both interest income from the purchase date until the maturity date and the difference between the purchase price and the maturity value.

The current yield for a bond is determined by dividing dollar amount of annual interest by the current market value.

A type of bond that is unsecured and gives bondholders a claim secondary to that of other designated bondholders, with respect to both income and assets is called a(n):

Identify the incorrect statement.

A bond that can be exchanged, at the owner's option, for a specified number of shares of the corporation's stock is called a(n) ____________ bond.

For government bonds, the bid price is the price that a dealer is willing to pay for a government security.

Interest payments for registered bonds are mailed directly to the bondholder of record.

A government security issued in minimum units of $1,000 with maturities that are less than one year is called a:

Mortgage bonds are agreements that pledge land, buildings, or equipment as securities for a loan.

A corporate bond rated B by the DBRS would be suitable for:

Assume that you purchase a $1,000 corporate bond that pays 5.5 percent interest.What is the amount of interest that you receive each year?

Collateral trust bonds are secured, through a pledge of real property.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Mutual Funds

Retirement Planning

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Exam 12: Investing in Bonds

The main reason why investors choose Canadian government securities is the above average interest rates that these securities pay.

Assume that you purchased a $1,000 Rogers bond that pays 6 percent interest.What is the amount of interest you would receive each six months?

In what year were Canada Savings Bonds discontinued for sale?

A subordinated debenture is a more secure investment than a mortgage bond.

The Canada Savings Bond Payroll Program does not allow you to save through regular payroll deductions.

When a bond is selling for more than its face value, it is said to be selling at a:

A corporate bond rated AAA by the DBRS would be suitable for:

Generally, interest on corporate bonds is paid every

The yield to maturity takes into account both interest income from the purchase date until the maturity date and the difference between the purchase price and the maturity value.

The current yield for a bond is determined by dividing dollar amount of annual interest by the current market value.

A type of bond that is unsecured and gives bondholders a claim secondary to that of other designated bondholders, with respect to both income and assets is called a(n):

Identify the incorrect statement.

A bond that can be exchanged, at the owner's option, for a specified number of shares of the corporation's stock is called a(n) ____________ bond.

For government bonds, the bid price is the price that a dealer is willing to pay for a government security.

Interest payments for registered bonds are mailed directly to the bondholder of record.

A government security issued in minimum units of $1,000 with maturities that are less than one year is called a:

Mortgage bonds are agreements that pledge land, buildings, or equipment as securities for a loan.

A corporate bond rated B by the DBRS would be suitable for:

Assume that you purchase a $1,000 corporate bond that pays 5.5 percent interest.What is the amount of interest that you receive each year?

Collateral trust bonds are secured, through a pledge of real property.

Personal Financial Planning: An Introduction

Money Management Strategy: Financial Statements and Budgeting

Planning Your Tax Strategy

Banking Services of Financial Institutions

Introduction to Consumer Credit

Choosing a Source of Credit: The Costs of Credit Alternatives

The Finances of Housing

Home and Automobile Insurance

Life, Health, and Disability Insurance

Fundamentals of Investing

Investing in Stocks

Investing in Mutual Funds

Retirement Planning

Estate Planning

Filters