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Chapter 02 Asset Classes and Financial Instruments

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Question;25.;The price quotations;of Treasury bonds in the Wall Street Journal show an ask price of 104:08 and a bid price of 104:04. As;a buyer of the bond, what is the dollar price you expect to pay?;A.;$1,048.00;B.;$1,042.50;C.;$1,044.00;D.;$1,041.25;E.;$1,040.40;26.;The price quotations;of Treasury bonds in the Wall Street Journal show an ask price of 104:08 and a bid price of 104:04. As;a seller of the bond what is the dollar price you expect to pay?;A.;$1,048.00;B.;$1,042.50;C.;$1,041.25;D.;$1,041.75;E.;$1,040.40;27.;An investor;purchases one municipal and one corporate bond that pay rates of return of 8%;and 10%, respectively. If the investor is in the 20% marginal tax bracket;his or her after-tax rates of return on the municipal and corporate bonds;would be ________ and ______, respectively.;A.;8% and 10%;B.;8% and 8%;C.;6.4% and 8%;D.;6.4% and 10%;E.;10% and 10%;28.;An investor;purchases one municipal and one corporate bond that pay rates of return of;7.5% and 10.3%, respectively. If the investor is in the 25% marginal tax;bracket, his or her after-tax rates of return on the municipal and corporate;bonds would be ________ and ______, respectively.;A.;7.5% and;10.3%;B.;7.5% and;7.73%;C.;5.63% and;7.73%;D.;5.63% and;10.3%;E.;10% and 10%;29.;If a Treasury note;has a bid price of $975, the quoted bid price in the Wall Street Journal would be;A.;97:50.;B.;97:16.;C.;97:80.;D.;94:24.;E.;97:75.;30.;If a Treasury note;has a bid price of $995, the quoted bid price in the Wall Street Journal would be;A.;99:50.;B.;99:16.;C.;99:80.;D.;99:24.;E.;99:32.

 

Paper#55074 | Written in 18-Jul-2015

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