test ch2 fixed income

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in most countries the bond market sector with the smallest amount of bonds outstanding is most likely the?
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Terms in this set (31)
in most countries the bond market sector with the smallest amount of bonds outstanding is most likely the?
non financial corporate sector
The distinction between investment grade debt and non-investment grade debt is best described by differences in:
tax status.
credit quality.
maturity dates.
credit quality
A bond issued internationally, outside the jurisdiction of the country in whose currency the bond is denominated, is best described as a:
Eurobond.
foreign bond.
municipal bond.
eurobond
When classified by type of issuer, asset-backed securities are part of the:
Structured finance sector
Compared with developed markets bonds, emerging markets bonds most likely:
exhibit higher risk
With respect to foating-rate bonds, a reference rate such as the London interbank offered
rate (Libor) is most likely used to determine the bond's:
Coupon rate
The variability of the coupon rate on a Libor-based floating-rate bond is most likely due to:

A periodic resets of the reference rate.
B market-based reassessments of the issuer's creditworthiness.
C changing estimates by the Libor administrator of borrowing capacity.
Periodic resets of the reference rate
Which of the following statements is most accurate? An interbank offered rate:
is used as a reference rate for interest rate swaps
An investment bank that underwrites a bond issue most likely:
buys and resells the newly issued bonds to investors or dealers
In major developed bond markets, newly issued sovereign bonds are most often sold to the public via a(n):

A auction.
B private placement.
C best efforts offering.
auction
Which of the following describes privately placed bonds?They are non underwritten and unregisteredA mechanism by which an issuer may be able to offer additional bonds to the general public without preparing a new and separate offering circular best describes:shelf registrationWhich of the following statements related to secondary bond markets is most accurate?Secondary bond markets are where bonds are traded between investorsA bond market in which a communications network matches buy and sell orders initiated from various locations is best described as an: A.) organized exchange. B.) open market operation. C.) over-the-counter market.C) over-the-counter marketA liquid secondary bond market allows an investor to sell a bond at: A the desired price. B a price at least equal to the purchase price. C a price close to the bond's fair market value.C. a price close to the bond's fair market value.Corporate bond secondary market trading most often occurs:Book-entry basisSovereign bonds are best described as: A bonds issued by local governments. B secured obligations of a national government. C bonds backed by the taxing authority of a national government.C. bonds backed by the taxing authority of a national government.Which factor is associated with a more favorable quality sovereign bond credit rating?Issued in local currency of country with strong domestic savings baseWhich type of sovereign bond has the lowest interest rate risk for an investor? A Floaters B Coupon bonds C Discount bondsfloatersAgency bonds are issued by:quasi-government entitiesThe type of bond issued by a multilateral agency such as the International Monetary Fund (IMF) is best described as a: A sovereign bond. B supranational bond. C quasi-government bond.Supranational bondA bond issued by a local government authority, typically without an explicit funding commitment from the national government, is most likely classified as a:Non sovereign government bondWhich of the following statements relating to commercial paper is most accurate?Commercial paper is a source of interim financing for long-term projectsEurocommerical paper is most likely: A negotiable. B denominated in euro. C issued on a discount basis.NegotiableFor the issuer, a sinking fund arrangement is most similar to a: A term maturity structure. B serial maturity structure. C bondholder put provision.B) serial maturity structureWhen issuing debt, a company may use a sinking fund arrangement as a means of reducing: A credit risk. B inflation risk. C interest rate risk.credit riskWhich of the following is a source of wholesale funds for banks?negotiable certificates of depositA characteristic of negotiable certificates of deposit is:they can be sold in the open market prior to maturityA repurchase agreement is most comparable to a(n):a collateralized loan.The repo margin is:Negotiated between counter partiesThe repo margin on a repurchase agreement is most likely to be lower when:the underlying collateral is in short supply