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Financial Management MCQs – Practice Test 2 (Chapter 3)

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Free "Bonds and Bond Valuation Study" App Download (iOS & Android) with MCQ: Treasury bonds are exposed to additional risks and include; with answers: interest rate risk, reinvestment risk, and investment risk. Practice Expected Rate of Return on Constant Growth Stock Quiz Questions, download Apple Book (Free Chapter) to improve learning efficiency.

Bonds & Bond Valuation MCQ – Practice Test 2 PDF Download

MCQ 6: The treasury bonds are exposed to additional risks and include:

  1. reinvestment risk
  2. interest rate risk
  3. investment risk
  4. Both A and B

MCQ 7: If the bond's call provision is practiced in first year of issuance then an additional payment is classified as:

  1. issuance provision
  2. bond provision
  3. call provision
  4. first provision

MCQ 8: The reinvestment risk of bonds is higher on:

  1. short maturity bonds
  2. high maturity bonds
  3. high premium bonds
  4. high inflated bonds

MCQ 9: The bonds that have high liquidity premium usually have:

  1. inflated trading
  2. default free trading
  3. less frequently traded
  4. frequently traded

MCQ 10: The bond which is offered below its face value is classified as:

  1. present value bond
  2. original issue discount bond
  3. coupon issued bond
  4. discounted bond

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