Exam 2: Asset Classes and Financial Instruments

Which of the following indices is(are) market-value weighted? I. The New York Stock Exchange Composite Index II. The Standard and Poor's 500 Stock Index III. The Dow Jones Industrial Average

Treasury Inflation-Protected Securities (TIPS)

For a taxpayer in the 25% marginal tax bracket, a 20-year municipal bond currently yielding 5.5% would offer an equivalent taxable yield of

An investor purchases one municipal and one corporate bond that pay rates of return of 7.2% and 9.1%, respectively. If the investor is in the 15% marginal tax bracket, his or her after-tax rates of return on the municipal and corporate bonds would be ________ and ______, respectively.

Deposits of commercial banks at the Federal Reserve Bank are called

Suppose an investor is considering a corporate bond with a 7.17% before-tax yield and a municipal bond with a 5.93% before-tax yield. At what marginal tax rate would the investor be indifferent between investing in the corporate and investing in the muni?

Which of the following is used extensively in foreign trade when the creditworthiness of one trader is unknown to the trading partner?

The maximum maturity of commercial paper that can be issued without SEC registration is

Certificates of deposit are insured for up to ____________ in the event of bank insolvency.

With regard to a futures contract, the long position is held by

A bond that can be retired prior to maturity by the issuer is a(n) ____________ bond.

A call option allows the buyer to

In order for you to be indifferent between the after-tax returns on a corporate bond paying 7% and a tax-exempt municipal bond paying 5.5%, what would your tax bracket need to be?

The Dow Jones Industrial Average (DJIA) is computed by

The yield to maturity reported in the financial pages for Treasury securities

The money market is a subsector of the

The largest component of the fixed-income market is _______ debt.

In order for you to be indifferent between the after-tax returns on a corporate bond paying 8.5% and a tax-exempt municipal bond paying 6.12%, what would your tax bracket need to be?

The ____ index represents the performance of the Japanese stock market.

With regard to a futures contract, the short position is held by