Term structure premium, an inflation of bond and bond default premium are included in_________________?
Correct answer: B. Risk factors
- A. Premium factors
- B. Risk factors
- C. Bond buying factors
- D. Multi model
Explanation
Term-structure, inflation, and bond-default premiums are risk-related components used in determining required returns on bonds. They represent compensation for different sources of bond risk.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
Practise Business Finance
975 free Business Finance MCQs from Management Sciences, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Management Sciences questions like this
Management Sciences is on 2 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Business Finance questions
Chance of occurrence of any event is classified as_____________?
Tendency of moving together of two variables is classified as_____________?
Relationship between risk and required return is classified as___________?
Tendency of measuring correlation of two variables is classified as_________?
Chance of happening any unfavorable event in near future is classified as___________?
Coefficient of variation is used to identify an effect of__________?