Down-sloping yield curve indicates

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Reference no: EM131178756

1. What effect, if any, will a decrease in interest rates have on bond values?

a. Bond values may increase or decrease, depending on the maturity, quality, and coupon rate

b. None of the above

c. Bond values will decrease

d. Bond values will increase

2. A down-sloping yield curve indicates:

a. investors' anticipation of lower inflation.

b. More than one of the above

c. that institutional investors are selling long-term bonds.

d. investors' anticipation of lower interest rates

3. Special or abnormal returns" refer to:

a. the Efficient Market Hypothesis.

b. More than one of the above

c. gains in excess of the market risk-adjusted average.

d. convertibles and warrants, etc.

4. One reason a firm may repurchase its own shares is:

a. to go public.

b. that management views the firm's future prospects to be bright.

c. to qualify for an exchange listing.

d. to adhere to SEC requirements on number of shares outstanding.

5. The Dow Theory uses _________ to follow three major types of market movements.

a. None of the above

b. fundamental analysis

c. charting

d. key indicators

6. The ____________ suggests watching the small investor, who is right most of the time but misses key market turns, and then doing the opposite.

a. greed index

b. odd-lot theory

c. None of the above

d. contrary opinion rule

7. There is rarely a significant change in stock price when an OTC stock becomes listed on a national exchange.

True False

8. Corporate bonds carry a higher yield than government issues, and are fully taxable for federal, state, and local purposes.

True False

9. A Treasury bill is a long-term obligation of the federal government.

True False

10. The price of a bond represents simply the future value of interest payments.

True False

11. Current yield does not take the maturity date into consideration.

True False

12. An investment banker overprices an issue in order to satisfy the corporate issuer.

True False

13. The strong form of the efficient market hypothesis suggests that only insiders are able to show superior risk-adjusted returns.

True False

14. Chartists do not consider volume significant in reading market indicators.

True False

15. Technical analysis assumes that many chart patterns tend to repeat themselves.

True False

Reference no: EM131178756

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