Orion Series 65 Section 5 Questions

A bond, preferred stock, or debenture exchangeable at the option of the holder (for common stock of the issuing corporation) is a?

Convertible Security

An unsecured bond is also known as a?

Debenture

An investor is considering the purchase of $100,000 maturity value of zero-coupon AAA rated corporate bonds scheduled to mature in 20 years. Among the risks that this investor will be assuming are?

Default Risk and Interest Rate Risk

In the secondary market, Treasury bond prices are most influenced by the?

Inflation rate

What happens to outstanding fixed-income securities when interest rates decline?

Prices increase

What would likely happen to the market value of existing bonds during an inflationary period coupled with rising interest rates?

The price of the bonds would decrease.

A method of valuing an investment, particularly debt securities, by calculating what future cash returns will be work at the time they are received, based on estimates of future inflation and interest rates is known as?

discounted cash flow