P1 Test 2, 2MP Corporate Bonds and Mutual Funds

Aiden is the CFO of a large corporation. Why might Aiden decide to sell bonds for the company?

• To increase stock prices.

• To raise capital for projects.

• To decrease their liabilities.

• To distribute profits to shareholders.

One source of information for selecting bond investments is (a)  

• Stock market trends.

• Bond ratings.

• Real estate prices.

• Currency exchange rates.

What is one method of buying mutual funds?

• Through a stockbroker.

• Directly from the company.

• At a bank teller.

• Via a real estate agent.

The purpose of questioning what you read is to (a)  

• To memorize the content.
• To ensure understanding.
• To find errors in the text.
• To prepare for a debate.

What did Julie Schmidt notice on her sample ballot?

• Several government bond measures

• New tax laws

• School board elections

• Local business regulations

What is a systematic investment program?

• Investing different amounts each month

• Investing the same amount each month

• Investing only when prices are high

• Investing only when prices are low

A serial bond is a bond that matures in (a)   .

• installments
• all at once
• monthly
• annually

What is a zero-coupon bond?

• A bond that pays interest every year

• A bond that pays interest semiannually

• A bond that pays interest every month

• A bond that pays interest annually

• A bond that pays no interest until it matures

• A bond that pays interest monthly

• A bond that pays interest twice a year

• A bond that pays no interest until maturity

How does the interest rate on a convertible bond typically compare to other bonds?

• 1 to 2 percent lower

• 1 to 2 percent higher

• The same

• 5 percent higher

What interest rate was Mobil Corporation's bond issued at?

• 4.5 percent

• 6.5 percent

• 8.5 percent

• 10.5 percent