The spread between the interest rates on bonds with default risk and default-free bonds is called the risk premium.
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举一反三
- (I) The risk premium widens as the default risk on corporate bonds increases. (II) The risk premium widens as corporate bonds become less liquid.
- Bonds with relatively high risk of default are called ________
- (I) The risk premium widens as the default risk on corporate bonds increases. (II) The risk premium widens as corporate bonds become less liquid. A: (I) is true, (II) false. B: (I) is false, (II) true. C: Both are true. D: Both are false.
- Interest rates on banker’s acceptances are low because the risk of default is very low.
- Which of the following risks can be diversified through portfolio investment? _____. A: Interest rate risk B: Inflation risk C: Market risk D: Default risk
内容
- 0
The interest rates on government agency bonds are _________
- 1
Assume the following:·The real risk-free rate of return is 3%.·The expected inflation premium is 5%.·The market-determined interest rate of a security is 12%.The sum of the default risk premium, liquidity premium, and maturity premium for the security isclosestto: A: 10%. B: 4%. C: 8%.
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8．The risk investors have that a callable bond will be called when interest rates fall is Call risk. ( )
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Changes in interest rates make investments in long-term bonds risky.
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If interest rates increase, the prices of bonds and preferred stock increase.