All Free Management Sciences MCQs with Answers
Every Management Sciences question in the bank, across all chapters, each with the correct answer and a written explanation. Free and unlimited, with no account needed.
3,770 questions · page 43 of 189
- A. lesser cost fluctuations
- B. wider price fluctuations
- C. less price fluctuations
- D. wider cost fluctuations
Explanation: Treasury bonds and notes generally have longer maturities than Treasury bills, so their prices react more strongly to changes in interest…
Correct answer: wider price fluctuations- A. annually
- B. semiannually
- C. monthly
- D. quarterly
Explanation: Floating-rate Eurobonds commonly pay interest semiannually, with the coupon reset periodically against a reference interest rate.
Correct answer: semiannually- A. relatively lower
- B. relatively higher
- C. relatively zero
- D. relatively discounted
Explanation: Convertible bonds normally offer investors the additional benefit of converting into shares, so investors accept a lower yield than on…
Correct answer: relatively lower844. The principal value of TIPS is increased or decreased and is based on the measure of __________?
- A. consumer price index
- B. manufacturing price index
- C. auction selling index
- D. inflation payment index
Explanation: Treasury Inflation-Protected Securities adjust their principal according to changes in the Consumer Price Index.
Correct answer: consumer price index- A. return on assets
- B. return on callable bond
- C. return on non-callable bonds
- D. return on equity
Explanation: A callable bond's return is considered in relation to a comparable non-callable bond plus the effect of the issuer's call option.
Correct answer: return on callable bond- A. long term bonds
- B. short term bonds
- C. corporate bonds
- D. Federal Reserve bonds
Explanation: Corporate bonds are debt securities issued by companies, commonly to obtain funds for several years or other long-term purposes.
Correct answer: corporate bonds847. According to marketability feature, the bonds which are attached to stock warrants have ___________?
- A. decreased floatation
- B. increased floatation
- C. increased marketability
- D. decreased marketability
Explanation: A stock warrant gives the bondholder a potential right to buy shares, adding an equity-related benefit to the bond and making it more…
Correct answer: increased marketability848. The call premium is $456 and the face value of the bond is $234 then the call price of bonds is
- A. 1.95
- B. 0.0195
- C. 222
- D. 690
Explanation: A bond's call price equals its face value plus the call premium: $234 + $456 = $690.
Correct answer: 690849. The call premium is $640 and the face value of the bond is $285 then the call price of bonds is
- A. 2.25
- B. 355
- C. 925
- D. 0.0225
Explanation: The call price is found by adding the face value and call premium: $285 + $640 = $925.
Correct answer: 925850. The current selling price of the municipal bonds available to bond holders is used to calculate
- A. yield to income tax
- B. yield to municipal bonds
- C. yield to tax rate
- D. yield to revenue bonds
Explanation: A municipal bond's current selling price is used when determining its market yield, described here as the yield to municipal bonds.
Correct answer: yield to municipal bonds- A. more index inflation
- B. less indexed inflation
- C. less active
- D. more active
Explanation: Municipal bonds generally trade in a less active market than Treasury bonds because their issues are smaller and vary more by locality.
Correct answer: less active852. The financial securities issued by the local and state governments are classified as _________?
- A. municipal bonds
- B. reserve bonds
- C. state bonds
- D. federal bonds
Explanation: Municipal bonds are issued by state and local governments to finance public projects and services.
Correct answer: municipal bonds- A. double B
- B. triple B
- C. triple A
- D. double A
Explanation: AAA, or triple-A, is the highest credit rating and indicates the lowest expected default risk.
Correct answer: triple A- A. LIBOR rate monthly
- B. coupon interest monthly
- C. coupon interest semiannually
- D. coupon interest annually
Explanation: U.S. Treasury notes and bonds normally pay coupon interest twice a year, so the payment frequency is semiannual.
Correct answer: coupon interest semiannually- A. investment banks
- B. commercial banks
- C. euro transfer agencies
- D. currency deposit banks
Explanation: Investment banks arrange and distribute Eurobond issues in the primary market, often through an underwriting syndicate.
Correct answer: investment banks- A. local tax and revenue
- B. global tax and revenue
- C. print notes
- D. commercial notes
Explanation: Municipal bonds are repaid from local taxes and revenues, depending on whether they are general-obligation or revenue bonds.
Correct answer: local tax and revenue- A. premium bid auction
- B. discount bid auction
- C. multiple bid auction
- D. One bid auction
Explanation: TIPS are issued through a single-price, or uniform-price, auction, in which successful bidders pay the same accepted price.
Correct answer: One bid auction- A. origination services
- B. document collection services
- C. advising services
- D. both a and c
Explanation: In a negotiated sale, the investment bank commonly helps originate the issue and advises the municipality on pricing and terms.
Correct answer: both a and c- A. triple B rating bonds
- B. double B
- C. triple A
- D. double A
Explanation: BBB is the lowest investment-grade rating in the major rating systems, while BB is below investment grade.
Correct answer: triple B rating bonds- A. call premium
- B. call provision
- C. discount premium
- D. discount provision
Explanation: When a callable bond is redeemed above its face value, the excess of the call price over face value is the call premium.
Correct answer: call premium