Test 2 F302
speculative
"junk" bonds are a street name for ______ grade bonds
informational efficiency
____ refers to how quickly information is reflected in the available prices for trading
operational efficiency
_____ has to do with the speed and accuracy of processing a buy or sell order at the best available price
constant growth
______ means that the percentage increase in the dividend is the same each year
market, risk free security
a beta of 1.0 is the beta of the
long term debt
a bond is a ____ instrument by which a borrower of funds agrees to pay back the funds with interest on a specific date in the future
beta is
all of the above
unsystematic risk
can be diversified away
{E(rm)-rf}
if the equation e=rf+{E(rm)-rf]xi, is the linear equation for the security market line, what portion represents market risk premium fr stock that doesn't have beta of 1.0?
weak-form efficiency markets
in _____, current prices reflect the price history and trading volume of the stock. it is of no use to chart historical stock prices to predict future stock prices such that you can identify mispriced stocks and routinely outperform the market
all of the above
stocks differ from bonds because____
coupon rate
the ____ is the interest rate printed on the bond
yield to maturity
the ____ is the return the bond holder receives on the bond if held to maturity
maturity date
the _____ is the expiration date of the bond
coupon
the _____ is the regular interest payment of the bond
every period
the holder of a preferred stock is entiled to a constant dividend _____
diversification
the practice of not putting all your eggs in one basket an illustration of ____
diversifiable risk, unsystematic risk
the terms _____ and _____ mean the same thing
present value of future cash flows that will be received
the value of a financial asset is the _________
which of the following investments is considered to be default risk-free
treasury bills
$100
trials inc. has issued 30-year 1000 face value 10% annual coupon bonds with a yield to maturity of 9%. the annual interest payment for the bond is ____
coupon rate, discount to
when the ____ is less than the yield to maturity, the bond sells at a/the _____ the par value
investors want to maximize return and minimize risk
which of the below statements is true?
secondary market
you can think of the _____ as the "used stock" market because these shares have been owned or "used" previously
priced at a deep discount
zero-coupon bonds are