Question 1

In which of the following periods was the yield curve inverted?

Accepted Answer

A) February 2004 
B) February 2007 
C) February 2010 
D) The yield curve was not inverted during any of these periods. 
A) February 2004 
B) February 2007 
C) February 2010 
D) The yield curve was not inverted during any of these periods.

Question 2

Suppose that your marginal federal income tax rate is 30%, the sum of your marginal state and local tax rates is 5%, and the yield on a thirty-year corporate bond is 10%. You would be indifferent between buying this corporate bond and buying a thirty-year municipal bond issued within your state (ignoring differences in liquidity, risk, and costs of information)if the municipal bond has a yield of

Accepted Answer

A) 6)5%. 
B) 7)0%. 
C) 9)5%. 
D) 10.0%. 
A) 6)5%. 
B) 7)0%. 
C) 9)5%. 
D) 10.0%.

Question 3

The risk premium of corporate bonds typically increases

Accepted Answer

A) when the average price of corporate bonds increase. 
B) during a recession. 
C) when the interest rates on corporate bonds decreases. 
D) when the risk premium on treasury bonds increases. 
A) when the average price of corporate bonds increase. 
B) during a recession. 
C) when the interest rates on corporate bonds decreases. 
D) when the risk premium on treasury bonds increases.

Question 4

Discuss what happened to the market prices on corporate securities relative to government securities during the Great Recession.

Accepted Answer

The Great Recession was accompanied by a

Question 5

Suppose the private bond rating agencies ceased to exist. What would be the impact on the bond market?

Accepted Answer

If the private bond rating agencies ceas

In which of the following periods was the yield curve inverted?

The risk premium of corporate bonds typically increases

Discuss what happened to the market prices on corporate securities relative to government securities during the Great Recession.

Suppose the private bond rating agencies ceased to exist. What would be the impact on the bond market?

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Stock Market, Information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, Asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, Mutual Funds, Hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserve and Central Banking

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: The Aggregate Demand and Aggregate Supply Model

Monetary Theory II: The IS-MP Model

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Exam 5: The Risk Structure and Term Structure of Interest Rates

In which of the following periods was the yield curve inverted?

The risk premium of corporate bonds typically increases

Discuss what happened to the market prices on corporate securities relative to government securities during the Great Recession.

Suppose the private bond rating agencies ceased to exist. What would be the impact on the bond market?

Introducing Money and the Financial System

Money and the Payments System

Interest Rates and Rates of Return

Determining Interest Rates

The Stock Market, Information, and Financial Market Efficiency

Derivatives and Derivative Markets

The Market for Foreign Exchange

Transactions Costs, Asymmetric Information, and the Structure of the Financial System

The Economics of Banking

Investment Banks, Mutual Funds, Hedge Funds, and the Shadow Banking System

Financial Crises and Financial Regulation

The Federal Reserve and Central Banking

The Federal Reserves Balance Sheet and the Money Supply Process

Monetary Policy

The International Financial System and Monetary Policy

Monetary Theory I: The Aggregate Demand and Aggregate Supply Model

Monetary Theory II: The IS-MP Model

Filters