Down-sloping yield curve indicates

Assignment Help Financial Management
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

Questions Cloud

Total value of the coins : Kevin and Randy Muise have a jar containing 50 coins, all of which are either quarters or nickels. The total value of the coins in the jar is $9.30. How many of each type of coin do they have?
Firm is concerned about its currency risk : The U. S- based MNC Kline has payables of CHF 250,000 in nine months. The firm’s economist forecasts that the CHFUSD could end the period with a value of either 1.10 (probability of 55 percent) or 1.00 (45 percent). The firm is concerned about its cu..
Write case study report on woolthworths limited : Write 1200 word Case study report on woolthworths limited, in regards to job cuts, difficulties within the last 6-12 months, MUST BE WRITTEN IN THE THIRD PERSON
Create a project management plan for your client : Create a project management plan for your client that outlines how you will implement the HRIS in Gladwell Grocery Stores. Explain the various steps that should be included to ensure that the implementation runs smoothly.
Down-sloping yield curve indicates : An investment banker overprices an issue in order to satisfy the corporate issuer. A Treasury bill is a long-term obligation of the federal government. A down-sloping yield curve indicates: What effect, if any, will a decrease in interest rates have ..
Which of the given statements is correct : What are most often involved in perpetuating fraudulent financial reporting.- Internal control is a process designed to achieve objectives in:
Determining the possibly depending : Suppose that gcd(a, b) = 1 with a, b > 0, and let x0, y0 be any integer solution to the equationax + by = c. Find a NECESSARY AND SUFFICIENT condition, possibly depending on a, b, c, x0, y0 that the equation have a solution with x > 0 and y > 0
How your articles are consistent with your own findings : Explain how your articles are consistent with your own findings. You need to relate the articles to any of the concepts discussed during the previous weeks.
Corporate taxes-what is the value of the levered firm : A firm with no debt financing has a firm value of $34 million. It has a corporate marginal tax rate of 38 percent. The firm’s investors are estimated to have marginal tax rates of 28 percent on interest income and a weighted average of 21 percent on ..

Reviews

Write a Review

Financial Management Questions & Answers

  What will be swap rate on agreement to exchange currency

Suppose the U.S. yield curve is flat at 5% and the euro yield curve is flat at 4%. The current exchange rate is $1.25 per euro. What will be the swap rate on an agreement to exchange currency over a 3-year period? The swap will call for the exchange ..

  Calculate the total accumulated value

Jessica deposits 8000 into fund A that earns a nominal rte of 4% convertible quarterly. At the end of each quarter for 5 years, Jessica withdraws 400 from A and deposits into fund B that earns a nominal interest rate of 5.5% convertible quarterly. Im..

  Compute the payback period for product

Compute the payback period for product X and product Y. Based on the payback period, which alternative would you select? (Assume a $200,000 investment)

  Purchased the stock without margin

You purchase 950 shares of 2nd Chance Co. stock on margin at a price of $29. Your broker requires you to deposit $18,500. 1. Suppose you sell the stock at a price of $37. What is your return? What would your return have been had you purchased the sto..

  Target capital structure that consists debt and equity

Axel Telecommunications has a target capital structure that consists of 30% debt and 70% equity. The company anticipates that its capital budget for the upcoming year will be $2,000,000. If Axel reports net income of $3,000,000 and it follows a resid..

  Merger valuation-what is the value of its tax shields

Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt. Vandell's debt interest rate is 7.8%. What is the value of its tax shields? What is t..

  Shares of stock will be outstanding after the split

Della's Pool Halls has 12,000 shares of stock outstanding with a par value of $1 per share and a market price of $39 a share. The firm just announced a 4-for-3 stock split. How many shares of stock will be outstanding after the split?

  Evaluate the proposed acquisition of new special-purpose

You have been asked by the president of your company to evaluate the proposed acquisition of a new special-purpose truck for $130,000. The truck falls into the MACRS 10-year class, and it will be sold after 10 years for $13,000. What will the cash fl..

  State highway department is planning the construction

A state highway department is planning the construction of a toll road. Construction cost will be $200M (at period=year 0). Annual maintenance is estimated to be $1M every year and forever. In addition, every 10 years in perpetuity (=forever), a majo..

  Arithmetic average return on the stock over five-year period

You've observed the following returns on Doyscher Corporation's stock over the past five years: -25.8 percent, 14.2 percent, 31.4 percent, 2.6 percent, and 21.6 percent. What was the arithmetic average return on the stock over this five-year period?

  What are the net cash flows associated with the project

Great Lakes Clinic has been asked to provide exclusive healthcare services for next year’s World Exposition. Although flattered by the request, the clinic’s managers want to conduct a financial analysis of the project. An up-front cost of $160,000 is..

  Calculate the annual return on the mutual funds

Suppose an individual invests $40,000 in a load mutual fund for two years. The load fee entails an up-front commission charge of 4.4 percent of the amount invested and is deducted from the original funds invested. In addition, annual fund operating e..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd