《金融市场学》习题

1、;金融市场学复习题1.Common stock is an example of a(n) _.A)debt security. B) money market security. C)equity security. D) a and b2.The required return to implement a given business project will be _ if interest rates are lower. This implies that businesses will demand a _ quantity of loanable funds when inte

2、rest rates are lower. A)greater; lower B) lower; greater C)lower; lower D) greater; greater3.The federal government demand for loanable funds is _. If the budget deficit was expected to increase, the federal government demand for loanable funds would _. A)interest elastic; decrease B)interest elasti

3、c; increase C)interest inelastic; increase D)interest inelastic; decrease 4.If the real interest rate was negative for a period of time, thenA)inflation is expected to exceed the nominal interest rate in the future.B)inflation is expected to be less than the nominal interest rate in the future. C)ac

4、tual inflation was less than the nominal interest rate. D)actual inflation was greater than the nominal interest rate.5.If inflation turns out to be lower than expectedA)savers benefit.B)borrowers benefit while savers are not affected. C)savers and borrowers are equally affected. D)savers are advers

5、ely affected but borrowers benefit.6.Assume that foreign investors who have invested in U.S. securities decide to increase their holdings of U.S. securities. This should cause the supply of loanable funds in the United States to _ and should place _ pressure on U.S. interest rates.A)decrease; upward

6、 B) decrease; downward C) increase; downward D) increase; upward7.If economic expansion is expected to decrease, the demand for loanable funds should _ and interest rates should _.A)increase; increase B)increase; decrease C)decrease; decrease D)decrease; increase8.When Japanese interest rates rise,

7、and if exchange rate expectations remain unchanged, the most likely effect is that the supply of loanable funds provided by Japanese investors to the United States will _, and the U.S. interest rates will _.A)increase; increase B)increase; decrease C)decrease; decrease D)decrease; increase9.Assume t

8、hat annualized yields of shortterm and longterm securities are equal. If investors suddenly believe interest rates will increase, their actions may cause the yield curve toA)become inverted. B)become flat. C) become upward sloping. D) be unaffected.10.If the liquidity premium exists, a flat yield cu

9、rve would be interpreted as the market expecting _ in interest rates.A)no changes B) a slight decrease C)a slight increase D) a large increase11.According to the segmented markets theory, if most investors suddenly preferred to invest in shortterm securities and most borrowers suddenly preferred to

10、issue longterm securities there would beA)upward pressure on the price of longterm securities.B)upward pressure on the price of shortterm securities.C)downward pressure on the yield of longterm securities.D)a and c12.Other things equal, the yield required on noncallable bonds should be _ the yield r

11、equired on callable bonds whose other characteristics are exactly the same.A)greater than B) equal to C) less thanD)All of the above are possible, depending on the size of the call premium.13.According to expectations theory, the sudden expectation of lower interest rates in the future will cause a

12、_ supply of shortterm funds provided by investors, and a _ supply of longterm funds.A)large; large B) large; small C) small; small D) small; large14. Assume that the Treasury experiences a large decrease in the budget deficit and purchases a large number of T-bills. This action will _ the supply of

13、T-bills in the market and places _ pressure on the yield of T-bills.A) decrease; downward B) decrease; upward C) increase; upward D) increase; downward15.A firm plans to issue 30day commercial paper for $9,900,000. Par value is $10,000,000. What is the firms cost of borrowing?A)12.12% B)11.11% C)13.

14、00% D)14.08% E)15.25%16.A repurchase agreement calls for an investor to buy securities for $4,925,000 and sell them back in 60 days for $5,000,000. What is the yield?A)9.43% B)9.28% C)9.14% D)9.00%17. Robbins Corp. frequently invests excess funds in the Mexican money market. One year ago, Robbins in

15、vested in a one-year Mexican money market security that provided a yield of 25%. At the end of the year, when Robbins converted the Mexican pesos to dollars, the peso had depreciated from $.12 to $.11. What is the effective yield earned by Robbins?A)25.00% B)35.41% C)14.59% D) none of the above 18.

16、Bullock Corp. purchases certain securities for $4,921,349, with an agreement to sell them back at a price of $4,950,000 at the end of a 30-day period. The repo rate is _ %.A) 7.08 B) 6.95 C) 6.99 D) 7.04 E) none of the above19.Assume U.S. interest rates are significantly higher than German rates. A

17、U.S. firm wanting to issue bonds could achieve a lower financing rate, without exchange rate risk by denominating the bonds inA)dollars.B)marks（德国马克）and making payments from U.S. headquarters.C)marks and making payments from a German subsidiary.D)dollars and making payments from a German subsidiary.

18、20.If interest rates suddenly _, those existing bonds that have a call feature are _ likely to be called.A)decline; more B)decline; less C) increase; more D) none of the above21.When financial institutions expect interest rates to _, they may _.A)increase; sell bonds and buy short term securitiesB)i

19、ncrease; sell short term securities and buy bondsC)decrease; sell bonds and buy short term securitiesD)B and C22.If the coupon rate _ the required rate of return, the price of a bond _ par value.A)equals; equals B)exceeds; is less thanC)is less than; is greater than D)B and CE)none of the above23.As

20、 interest rates consistently rise over a specific period, the market price of a bond you own would likely _ over this period. (Assume no major change in the bonds default risk.)A)consistently increase B)consistently decrease C)remain unchangedD)change in a direction that cannot be determined with th

21、e above information24.If analysts expect that the demand for loanable funds will increase, and the supply of loanable funds will decrease, they would most likely expect interest rates to _ and prices of existing bonds to _.A)increase; increase B) increase; decrease C) decrease; decrease D) decrease;

22、 increase25.If bond portfolio managers expect interest rates to increase in the future, they would likely _ their holdings of bonds now, which could cause the prices of bonds to _ as a result of their actions.A)increase; increase B) increase; decrease C) decrease; decrease D) decrease; increase26.If

23、 the United States announces that it will borrow an additional $10 billion, this announcement will normally cause the bond traders to expectA)higher interest rates in the future, and will buy bonds now.B)higher interest rates in the future, and will sell bonds now.C)stable interest rates in the futu

24、re, and will buy bonds now.D)lower interest rates in the future, and will buy bonds now.E)lower interest rates in the future, and will sell bonds now.27.If the level of inflation is expected to _, there will be _ pressure on interest rates and _ pressure on the required rate of return on bonds.A)inc

25、rease; upward; downward B) decrease; upward; downwardC)decrease; upward; upward D) increase; downward; upwardE)increase; upward; upward28.Using a(n) _ strategy, investors allocate funds evenly to bonds in each of several different maturity classes.A)matching B) laddered C)barbell D)interest rate E)

26、none of the above29.Managers of firms may consider a stock repurchase or even a leveraged buyout when they believe their stock is _ by the market, or a secondary stock offering when they believe their stock is _ by the market.A)undervalued; undervalued B) overvalued; overvaluedC)undervalued; overval

27、ued D) overvalued; undervalued E)none of the above30.A stocks average return is 10%. The average risk-free rate is 7%. The standard deviation of the stocks return is 4%, and the stocks beta is 1.5. What is the Treynor Index for the stock?A).03 B).75 C) 1.33 D) .02 E) 5031.A higher beta of an asset r

28、eflectsA)lower risk.B)lower covariance between the assets returns and market returns.C)higher covariance between the assets returns and the market returns.D)none of the above.32.The arbitrage pricing theory (APT) differs from the capital asset pricing model (CAPM) in that it suggests that stock pric

29、esA)are influenced only by the market itself.B)can be influenced by a set of factors in addition to the market.C)are not influenced at all by the market.D)cannot be influenced at all by the industry factors.33. If the returns of two stocks are perfectly correlated, thenA) their betas should each equal 1.0. B) the sum of their betas should equal 1.0.C) their correlation coefficient should equal 1.0.D) their portfolio standard deviation should equal 1.0.34.The risk of a short sale is that the stock priceA)may decrease o