Question 1

The J.P.Morgan and Company Global Government Bond Index is ________ representation of the individual country government bond indexes.

Accepted Answer

A) a value weighted 
B) a price weighted 
C) an unweighted 
D) none of the options 
A) a value weighted 
B) a price weighted 
C) an unweighted 
D) none of the options

Question 2

Domestic bonds account for the largest share of outstanding bonds,equaling approximately what percent of the total?

Accepted Answer

A) 78 percent 
B) 45 percent 
C) 25 percent 
D) 15 percent 
A) 78 percent 
B) 45 percent 
C) 25 percent 
D) 15 percent

Question 3

U.S.security regulations require Yankee bonds and U.S.corporate bonds sold to U.S.citizens to be

Accepted Answer

A) municipal bonds. 
B) registered bonds. 
C) bearer bonds. 
D) none of the options 
A) municipal bonds. 
B) registered bonds. 
C) bearer bonds. 
D) none of the options

Question 4

The coupon interest on Eurobonds

Accepted Answer

A) is paid annually. 
B) is paid in cash. 
C) is paid in arrears. 
D) all of the options 
A) is paid annually. 
B) is paid in cash. 
C) is paid in arrears. 
D) all of the options

Question 5

A convertible bond pays interest annually at a coupon rate of 5 percent on a par value of $1,000.The bond has 10 years maturity remaining and the discount rate on other-wise identical non-convertible debt is 5 percent.The bond is convertible into shares of common stock at a conversion price of $25 per share (i.e.,the bond is exchangeable for 40 shares).Today's closing stock price was $31.25.What is the floor value of this bond?

Accepted Answer

A) $800.00 
B) $1,000 
C) $1,250 
D) none of the options 
A) $800.00 
B) $1,000 
C) $1,250 
D) none of the options

Question 6

U.S.citizens must pay tax on the imputed interest represented by the fact that zero coupon bonds price gets a bit closer to par value as each year goes by.If you have a 25-year zero coupon bond with $1,000 par value,how much imputed interest will you record in the coming year if interest rates stay the same at ten percent?

Accepted Answer

A) $92.30 
B) $10 
C) $0 
D) none of the options 
A) $92.30 
B) $10 
C) $0 
D) none of the options

Question 7

Six-month U.S.dollar LIBOR is currently 4.25 percent; your firm issued floating-rate notes indexed to six-month U.S.dollar LIBOR plus 50 basis points.What is the amount of the next semi-annual coupon payment per U.S.$1,000 of face value?

Accepted Answer

A) $43.75 
B) $47.50 
C) $23.75 
D) $46.875 
A) $43.75 
B) $47.50 
C) $23.75 
D) $46.875

Question 8

Zero coupon bonds

Accepted Answer

A) have no interest income. 
B) are sold at a premium to par value. 
C) give only capital gains income. 
D) have no interest income and give only capital gains income. 
A) have no interest income. 
B) are sold at a premium to par value. 
C) give only capital gains income. 
D) have no interest income and give only capital gains income.

Question 9

The vast majority of new international bond offerings

Accepted Answer

A) are straight fixed-rate notes. 
B) are callable and convertible. 
C) are convertible adjustable rate. 
D) are adjustable rate,with interest rate caps and collars. 
A) are straight fixed-rate notes. 
B) are callable and convertible. 
C) are convertible adjustable rate. 
D) are adjustable rate,with interest rate caps and collars.

Question 10

With a bearer bond,

Accepted Answer

A) possession is evidence of ownership. 
B) the issuer keeps records indicating only who the current owner of a bond is. 
C) the owner's name is on the bond. 
D) the owner's name is assigned to the bond serial number,but not indicated on the bond. 
A) possession is evidence of ownership. 
B) the issuer keeps records indicating only who the current owner of a bond is. 
C) the owner's name is on the bond. 
D) the owner's name is assigned to the bond serial number,but not indicated on the bond.

Question 11

Zero-coupon bonds issued in 2016 are due in 2026.If they were originally sold at 55 percent of face value,the implied yield to maturity at issuance is

Accepted Answer

A) 1.062 percent. 
B) 6.17 percent. 
C) 8.31 percent. 
D) cannot be determined,need more information. 
A) 1.062 percent. 
B) 6.17 percent. 
C) 8.31 percent. 
D) cannot be determined,need more information.

Question 12

Underwriters for a domestic bond issue will commit their own capital to buy the issue from the borrower at a discount from the issue price.The discount,or underwriting spread,is typically

Accepted Answer

A) in the 1 to 1.5 percent range. 
B) in the 2 to 2.5 percent range. 
C) in the 3 to 3.5 percent range. 
D) in the 4 to 4.5 percent range. 
A) in the 1 to 1.5 percent range. 
B) in the 2 to 2.5 percent range. 
C) in the 3 to 3.5 percent range. 
D) in the 4 to 4.5 percent range.

Question 13

Which of the following is not one of the five main sovereign rating factors?

Accepted Answer

A) Religiosity assessment 
B) Institutional assessment 
C) Economic assessment 
D) Monetary assessment 
A) Religiosity assessment 
B) Institutional assessment 
C) Economic assessment 
D) Monetary assessment

Question 14

In terms of the types of instruments offered,

Accepted Answer

A) the Yankee bond market has been more innovative than the international bond market. 
B) the international bond market has been much more innovative than the U.S.market. 
C) the most innovations have come from Milan,just like any other fashion. 
D) none of the options 
A) the Yankee bond market has been more innovative than the international bond market. 
B) the international bond market has been much more innovative than the U.S.market. 
C) the most innovations have come from Milan,just like any other fashion. 
D) none of the options

Question 15

A global bond issue denominated in U.S.dollars and issued by U.S.corporations

Accepted Answer

A) trade as Eurobonds overseas. 
B) trade as domestic bonds in the U.S.domestic market. 
C) trade as Eurobonds overseas and trade as domestic bonds in the U.S.domestic market. 
D) none of the options 
A) trade as Eurobonds overseas. 
B) trade as domestic bonds in the U.S.domestic market. 
C) trade as Eurobonds overseas and trade as domestic bonds in the U.S.domestic market. 
D) none of the options

Question 16

When the bond sells at par,the implicit SF/$ exchange rate at maturity of a Swiss franc/U.S.dollar dual currency bond that pays $581.40 at maturity per SF1,000,is

Accepted Answer

A) SF0.58/$1.00. 
B) SF1.58/$1.00. 
C) SF1.72/$1.00. 
D) SF1.95/$1.00. 
A) SF0.58/$1.00. 
B) SF1.58/$1.00. 
C) SF1.72/$1.00. 
D) SF1.95/$1.00.

Question 17

On a reset date,floating-rate notes

Accepted Answer

A) experience very volatile price changes. 
B) market price will usually gravitate toward par. 
C) market price will usually gravitate toward par,unless the borrowers' credit rating has declined. 
D) none of the options 
A) experience very volatile price changes. 
B) market price will usually gravitate toward par. 
C) market price will usually gravitate toward par,unless the borrowers' credit rating has declined. 
D) none of the options

Question 18

Two major clearing systems for international bond transactions are

Accepted Answer

A) Euroclear and Clearstream International. 
B) Euroclear and Clearasil. 
C) Deutsche Börse Clearing and Cedel International. 
D) none of the options 
A) Euroclear and Clearstream International. 
B) Euroclear and Clearasil. 
C) Deutsche Börse Clearing and Cedel International. 
D) none of the options

Question 19

Publicly traded Yankee bonds must

Accepted Answer

A) meet the same regulations as U.S.domestic bonds. 
B) meet the same regulations as Eurobonds if sold to Europeans. 
C) meet the same regulations as Samurai bonds if sold to Japanese. 
D) none of the options 
A) meet the same regulations as U.S.domestic bonds. 
B) meet the same regulations as Eurobonds if sold to Europeans. 
C) meet the same regulations as Samurai bonds if sold to Japanese. 
D) none of the options

Question 20

The credit rating of an international borrower

Accepted Answer

A) depends on the volatility of the exchange rate. 
B) depends on the volatility,but not absolute level,of the exchange rate. 
C) is usually never higher than the rating assigned to the sovereign government of the country in which it resides. 
D) is unrelated to the rating assigned to the sovereign government of the country in which it resides. 
A) depends on the volatility of the exchange rate. 
B) depends on the volatility,but not absolute level,of the exchange rate. 
C) is usually never higher than the rating assigned to the sovereign government of the country in which it resides. 
D) is unrelated to the rating assigned to the sovereign government of the country in which it resides.

The J.P.Morgan and Company Global Government Bond Index is ________ representation of the individual country government bond indexes.

Domestic bonds account for the largest share of outstanding bonds,equaling approximately what percent of the total?

U.S.security regulations require Yankee bonds and U.S.corporate bonds sold to U.S.citizens to be

The coupon interest on Eurobonds

Six-month U.S.dollar LIBOR is currently 4.25 percent; your firm issued floating-rate notes indexed to six-month U.S.dollar LIBOR plus 50 basis points.What is the amount of the next semi-annual coupon payment per U.S.$1,000 of face value?

Zero coupon bonds

The vast majority of new international bond offerings

With a bearer bond,

Zero-coupon bonds issued in 2016 are due in 2026.If they were originally sold at 55 percent of face value,the implied yield to maturity at issuance is

Underwriters for a domestic bond issue will commit their own capital to buy the issue from the borrower at a discount from the issue price.The discount,or underwriting spread,is typically

Which of the following is not one of the five main sovereign rating factors?

In terms of the types of instruments offered,

A global bond issue denominated in U.S.dollars and issued by U.S.corporations

When the bond sells at par,the implicit SF/$ exchange rate at maturity of a Swiss franc/U.S.dollar dual currency bond that pays $581.40 at maturity per SF1,000,is

On a reset date,floating-rate notes

Two major clearing systems for international bond transactions are

Publicly traded Yankee bonds must

The credit rating of an international borrower

International Monetary System

Globalization and the Multinational Firm

Balance of Payments

Corporate Governance Around the World

The Market for Foreign Exchange

International Parity Relationships and Forecasting Foreign Exchange Rates

Futures and Options on Foreign Exchange

Management of Transaction Exposure

Management of Economic Exposure

Management of Translation Exposure

International Banking and Money Market

International Equity Markets

Interest Rate and Currency Swaps

International Portfolio Investment

Foreign Direct Investment and Cross-Border Acquisitions

International Capital Structure and the Cost of Capital

International Capital Budgeting

Multinational Cash Management

International Trade Finance

International Tax Environment and Transfer Pricing

Filters

Exam 12: International Bond Market

The J.P.Morgan and Company Global Government Bond Index is ________ representation of the individual country government bond indexes.

Domestic bonds account for the largest share of outstanding bonds,equaling approximately what percent of the total?

U.S.security regulations require Yankee bonds and U.S.corporate bonds sold to U.S.citizens to be

The coupon interest on Eurobonds

Six-month U.S.dollar LIBOR is currently 4.25 percent; your firm issued floating-rate notes indexed to six-month U.S.dollar LIBOR plus 50 basis points.What is the amount of the next semi-annual coupon payment per U.S.$1,000 of face value?

Zero coupon bonds

The vast majority of new international bond offerings

With a bearer bond,

Zero-coupon bonds issued in 2016 are due in 2026.If they were originally sold at 55 percent of face value,the implied yield to maturity at issuance is

Underwriters for a domestic bond issue will commit their own capital to buy the issue from the borrower at a discount from the issue price.The discount,or underwriting spread,is typically

Which of the following is not one of the five main sovereign rating factors?

In terms of the types of instruments offered,

A global bond issue denominated in U.S.dollars and issued by U.S.corporations

When the bond sells at par,the implicit SF/$ exchange rate at maturity of a Swiss franc/U.S.dollar dual currency bond that pays $581.40 at maturity per SF1,000,is

On a reset date,floating-rate notes

Two major clearing systems for international bond transactions are

Publicly traded Yankee bonds must

The credit rating of an international borrower

International Monetary System

Globalization and the Multinational Firm

Balance of Payments

Corporate Governance Around the World

The Market for Foreign Exchange

International Parity Relationships and Forecasting Foreign Exchange Rates

Futures and Options on Foreign Exchange

Management of Transaction Exposure

Management of Economic Exposure

Management of Translation Exposure

International Banking and Money Market

International Equity Markets

Interest Rate and Currency Swaps

International Portfolio Investment

Foreign Direct Investment and Cross-Border Acquisitions

International Capital Structure and the Cost of Capital

International Capital Budgeting

Multinational Cash Management

International Trade Finance

International Tax Environment and Transfer Pricing

Filters