Bloomberg Market Concepts Exam
(Latest Update )
Questions and Answers | Grade A |
100% Correct
Question:
Investors tend to pay attention to 3 metrics to keep tabs on a government's
credit worthiness. All 3 have the power to make investors demand higher
yields in government bond auctions. Often, a government debt crisis will
involve more than 1 of these factors
Answer:
1. Government Debt as a proportion of GDP (Debt/GDP)
2. Budget Deficit as a proportion of GDP (Deficit/GDP)
3. Aggressiveness of the repayment schedule
Question:
Investment Grade Corporate Bonds have a rating of
Answer:
BBB- or above
,Question:
Non-investment grade (aka High-Yield, Junk , Speculative) Corporate Bonds
have a rating of
Answer:
BB+ or below
Question:
Two Credit Risk Indicators investors commonly Use to see trouble brewing
Answer:
1. Credit Ratings
2. Credit Default Swaps
Question:
Credit Default Swap spreads reflect
Answer:
the intrinsic probability of default
,Question:
Credit rating agencies are able to categorize countries and companies into risk
categories, from which they have data on
Answer:
what percentage in the category will default on their loans
Question:
Bond yields are the inverse of
Answer:
bond prices
Question:
As inflation rises, bond prices
Answer:
go down and bond yields go up.
Question:
How is Inflation Measured
Answer:
Inflation readings and Output Gap
, Question:
Output Gap is
Answer:
the measure of the slackness or tightness in the economy
Question:
Top 3 inflation statistics read by the Central Bank
Answer:
GDP deflator
CPI statistic
Core Personal Consumer Expenditure
Question:
The difference in price between regular bonds and Treasury Inflation
Protected Securities (TIPS) are used to understand
Answer:
expected future inflation
(Latest Update )
Questions and Answers | Grade A |
100% Correct
Question:
Investors tend to pay attention to 3 metrics to keep tabs on a government's
credit worthiness. All 3 have the power to make investors demand higher
yields in government bond auctions. Often, a government debt crisis will
involve more than 1 of these factors
Answer:
1. Government Debt as a proportion of GDP (Debt/GDP)
2. Budget Deficit as a proportion of GDP (Deficit/GDP)
3. Aggressiveness of the repayment schedule
Question:
Investment Grade Corporate Bonds have a rating of
Answer:
BBB- or above
,Question:
Non-investment grade (aka High-Yield, Junk , Speculative) Corporate Bonds
have a rating of
Answer:
BB+ or below
Question:
Two Credit Risk Indicators investors commonly Use to see trouble brewing
Answer:
1. Credit Ratings
2. Credit Default Swaps
Question:
Credit Default Swap spreads reflect
Answer:
the intrinsic probability of default
,Question:
Credit rating agencies are able to categorize countries and companies into risk
categories, from which they have data on
Answer:
what percentage in the category will default on their loans
Question:
Bond yields are the inverse of
Answer:
bond prices
Question:
As inflation rises, bond prices
Answer:
go down and bond yields go up.
Question:
How is Inflation Measured
Answer:
Inflation readings and Output Gap
, Question:
Output Gap is
Answer:
the measure of the slackness or tightness in the economy
Question:
Top 3 inflation statistics read by the Central Bank
Answer:
GDP deflator
CPI statistic
Core Personal Consumer Expenditure
Question:
The difference in price between regular bonds and Treasury Inflation
Protected Securities (TIPS) are used to understand
Answer:
expected future inflation
