Exam 4: Understanding Interest Rates

The riskiness of an asset's returns due to changes in interest rates is ________.

Examples of discount bonds include ________.

An $8,000 coupon bond with a $400 coupon payment every year has a coupon rate of ________.

When talking about a coupon bond,face value and ________ mean the same thing.

What is the return on a 5 percent coupon bond that initially sells for $1,000 and sells for $1,200 next year?

The interest rate on Real Return Bonds is a direct measure of ________.

The ________ interest rate is adjusted for expected changes in the price level.

The present value of an expected future payment ________ as the interest rate increases.

If the interest rate is 5 percent,what is the present value of a security that pays you $1,050 next year and $1,102.50 two years from now? If this security sold for $2200,is the yield to maturity greater or less than 5 percent? Why?

A discount bond ________.