Advertisement
Not a member of Pastebin yet?
Sign Up,
it unlocks many cool features!
- This paperwork of ECO 316 Week 1 Chapter 4 Interest Rates and Rates of Return consists of:
- 4.1 Multiple Choice Questions
- 1) When you place your funds in a savings account at a bank, those funds are
- 2) Debt instruments are also called
- 3) A debt instrument represents
- 4) Simple loans and discount bonds differ from coupon bonds and fixed-payment loans in that
- 5) Issuers of coupon bonds
- 6) A simple loan involves
- 7) The amount of funds the borrower receives from the lender with a simple loan is called the
- 8) The total payment to a lender for a simple loan is
- 9) Suppose First National Bank makes a one-year simple loan of $1,000 at 7% interest to Harry's Restaurant. At the end of one year Harry's Restaurant will pay First National
- 10) Suppose First National Bank makes a one-year simple loan of $1000 to Harry's Restaurant. If at the end of one year Harry's Restaurant pays First National $1400, then the interest rate on this loan must have been
- 11) The most common type of simple loan is a(an)
- 12) A discount bond resembles a simple loan in that
- 13) A discount bond involves
- 14) Which of the following is NOT a discount bond?
- 15) Suppose Matt's Cars issues a one-year discount bond with a face value of $10,000, and received $9259, repaying $10,000 after one year. The interest rate on this bond would be
- 16) Suppose Matt's Cars issues a discount bond with a face value of $10,000 payable in one year with an interest rate of 4%. How much will Acme receive for the bond?
- 17) A coupon bond involves
- 18) The coupon rate is the
- 19) Which of the following is a coupon bond?
- 20) Which of the following is NOT true of a fixed payment loan?
- 21) Which of the following is a fixed payment loan?
- 22) Which of the following is NOT a fixed payment loan?
- 23) Treasury STRIPS are
- 24) Treasury STRIPS came into existence because
- 25) The concept of present value
- 26) The key difficulty in answering the question: "Would you be better off financing your home with a 15-year mortgage at 9% or by borrowing for five years at 8% and refinancing
- thereafter?" is that
- 27) The key to present value calculations is that they
- 28) Compounding refers to
- 29) If you deposit $500 in a savings account at an annual interest rate of 5%, how much will you have in the account at the end of five years?
- 30) If you deposit $10,000 in a savings account at an annual interest rate of 6%, how much will you have in the account at the end of three years?
- 31) $1 received n years from now has a value today of
- 32) At an interest rate of 6%, what is the present value of $10,000 to be received five years from now?
- 33) At an interest rate of 3%, what is the present value of $1000 to be received five years from now?
- 34) If the interest rate is 8%, what would you expect to pay for a discount bond paying $10,000 in ten years?
- 35) If the interest rate is 9%, what would you expect to pay for a discount bond paying $10,000 in two years?
- 36) The yield to maturity is equal to
- 37) For simple loans, the yield to maturity
- 38) What is the yield to maturity on a simple loan that requires payment of $500 plus $30 in interest one year from now?
- 39) The yield to maturity on a one-year discount bond equals
- 40) A one-year discount bond with a par value of $5000 sold today, at issuance, for $4750 has a yield to maturity of
- 41) A one-year discount bond with a
- To download this tutorial follow the link - https://bitly.com/1wyRiHR
- It's important to always pay off your debts in full. This will help you avoid late fees and interest. Credit cards should only be used in certain situations. Credit cards can be tempting because they are so easy to use, but remember how hard they are to pay off. Financial troubles can be very distracting.
Advertisement
Add Comment
Please, Sign In to add comment
Advertisement