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NEW QUESTION: 1
Which cloud characteristic is used to describe the sharing of physical resources between various entities?
A. resiliency
B. multitenancy
C. elasticity
D. ubiquitous access
Answer: B
NEW QUESTION: 2
Which of the following statements is (are) true with respect to the price behavior of callable bonds and prepayable securities?
I). At very high levels of interest rates, the price of a callable bond will be very close to that of an equivalent non-callable bond.
II). At very low levels of interest rates, the call embedded in the bond will have a very low value.
III). Negative convexity will begin to appear for a callable bond at very low yield levels.
IV). At low yield levels, modified duration will overestimate the expected bond price for a given unit change in yield.
A. I, III, and IV.
B. II and III.
C. I and III.
Answer: A
Explanation:
II is incorrect because at very low levels of interest rates, the issuer has a tremendous incentive to call in the bonds and reissue them at a lower coupon rate. Thus, the call embedded in the bond will have a very high value.
NEW QUESTION: 3
A. Option E
B. Option C
C. Option B
D. Option D
E. Option A
Answer: E
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