Question

Several links were posted to D2L and included。n the bond lecture slides which of the statements (I-IV) is (are) most likely FALSE I. When sh orter maturity treasuries are yielding less than longe r maturity treasuries, the yield curve is Il. When shorter maturity treasuries start to yield more than longer maturity treasuries, the bond market ls Il. When shorter maturity treasuries are yielding more than longer maturity treasuries, it would be a good V. If investors are confident that the economy is steadily improving, expect current considered to be normal expecting the economy's growth rate to slow, and the stock market usually falls in value shortly thereafter idea to sell some stocks in your retirement account and convert them into cash to be lower than their respective long term average levels of the VIX and TED B. IV D. I, IV 8. During lecture, we discussed the FED and recent monetary policy in the US. Which of the st most likely FALSE: A. Jerome Powell is the current FED Chair B. The FED Chair is nominated by the US President C. Like a US President, a FED Chair can serve a maximum of two four year terms D. To stimulate the US economy after the housing market collapse in 2008, the FED effectively lowered the federal funds rate to zero To stimulate the US economy a US dollars in circulation E. fter the housing market collapse in 2008, the FED increased the supply of 9. Today (T-O), an investor purchased a five year bond with an 8.0% coupon at par. Assume interest r do not change from now until the bond's maturity. If the investor holds the bond from now until maturity, the investor's rate of return will be closest to: A. 4.0% C. 7.0 % D. 8.0% E. 9.7 % 10. Today (T-0), an investor purchased a seven year bond with an 8.0% coupon for $105,500. The bond has a face value of $100,000. The bond's yield to maturity is closest to: A. 5.5 % C. 7.0 % D. 8.0% E, 11.0% 11. Today (7-0), an investor purchased a nine year bond with an 8.0% coupon for $9,680. The bond has a face value of $10,000. In six months (T 0.5) interest rates have increased by 1.0% and the investor decides to sell the bond immediately after receiving the first coupon payment. What is the investor's total gain (loss) on the bond? HINT: Total Gain (Loss) Price Change in Bond + Coupon A. ($583) B. ($183) C. ($150) D. $190 E. $990

Answer 1

Answered 1st one as it has many subparts:

Answer is C, as I & III are most likely to be false