Ünite Sınavı Soruları

I. Bonds sell at their par value.
II. Bonds sell above their par value.
III. Bonds sell below their par value.

What happens when the market interest rate is equal to the coupon interest rate?

Suppose that you are planning to invest in a stock that will pay TL 2.5 as dividend and its price will be TL 55 next year. Assume that this stock is correctly priced in the market and its market price is TL 50. If you buy it at this market price, then what is your expected dividend yield and capital gain yield?

_ _ _ _ _ _ _ is negative when there is a decline in value of a bond.

Which of the following completes the sentences above?

__________plots the relationship between bond yields and maturity.

Which one of the following is the most sensitive to changes in the market interest rates in general?

Which one of the below is the security that contractually obligates the issuer to make fixed coupon payments at fixed intervals plus it also pays out the face value of the bond at maturity together with the last coupon payment?

.....................bonds have a higher sensitivity to changes in market interest rates and have higher interest rate risk.

Which of the following abbreviations refers to the first time the company offers its shares to the public?

1. The Profitability
2. Growth Prospects
3. Investment Requirements
4. Payout Decisions of the Company

What do dividends depend on in the context of he cash flows that are associated with stocks?

______________ is the average rate of return that will be earned on a bond if it is bought at the market price and held until it matures.

................... bond investors face higher reinvestment rate risk
and will have a disadvantage when market interest rates decline.

1. You have a right to vote in the shareholders’ meeting
2. You have a right to receive dividends, if the corporation decides to distribute any
3. You have pre-emptive right.
4. You have the right to receive your share of the residual (Assets Liabilities) in case of dissolution of the company.

Which of the rights above you have if you purchase stocks of a company?

In terms of yield-to-maturity, which of the followings refers to the return you get from the change in the value of bond?

1. Price-earnings (P/E) ratio
2. Market value-to-book value (MV/BV) ratio
3. Price-to-sales ratio
4. Price-to-cash flows ratio
5. PEG, defined as the P/E ratio divided by the growth rate of earnings

Which of the above are the common ratios used as comparables in the context of valuation by comparables?

Which of the statement below is true for the relationship between a bond’s yield-to-maturity and the rate of return in a particular period?

[(1+ nominal interestrate)/(1+ Inflation rate)] −1

What will the equation give us?

1. Yield-to-maturity is the average rate of return that will be earned on a bond if it is bought at the market price and held until it matures.
2. Yield-to-maturity of a bond selling at par is equal to its coupon interest rate.
3. For discount bonds, yield-to-maturity is greater than their coupon rate
4. Yield-to-maturity of premium bonds is less than their coupon rate.
5. Yield-to-maturity has two components: current yield (annual coupon/current bond price) and capital gains yield ((p₁-p₀)/p₀).

Which of the statements above about yield-to-maturity are correct?

According to Standard & Poors, which of the following ratings indicates the bonds with the lowest default risk?