FIN 1O1/102/202
BUS/110.
BUSINESS
wiseman 2026/2027 BUSINESS
, FIN 101 Midterm 2 Exam
questions with correct answers
2026/2027 Edition Graded A+
1.What condition must exist if a bond's coupon rate is to equal both
the bond's current yield and its yield to maturity - ✅✅D. The bond
must be priced at par.
2.What is the principal amount of a bond that is repaid at the end of
the loan term called - ✅✅E. Face value
3.A bond's annual interest divided by its face value is referred to as the
- ✅✅C. coupon rate.
4.The market-required rate of return on a bond that is held for its
entire life is called the - ✅✅B. yield to maturity.
5.The current yield on a bond is equal to the annual interest divided by
the - ✅✅D. current market price.
, 6.The written agreement that contains the specific details related to a
bond issue is called the bond - ✅✅A. indenture
7.A registered-form bond is defined as a bond that - ✅✅C. pays
coupon payments directly to the owner of record.
8.This morning, Jeff found an aged bond certificate lying on the
street. He picked it up and noticed that it was a 50-year bond that
matured today. He presented the bond to the bank teller at his local
bank and received payment for both the entire principal and the final
interest payment. The bond that Jeff found must have been which
one of the following? - ✅✅D. Bearer-form bond
9.What term is used to describe an account that a bond trustee
manages for the sole purpose of redeeming bonds early? - ✅✅D.
Sinking fund
10.The call premium is the amount by which the - ✅✅D. call price
exceeds the par value.
11.Russell's has a bond issue outstanding. The issue's indenture
provision prohibits the firm from redeeming the bonds during the first
five years following issuance. This provision is referred to as the _____
provision. - ✅✅D. deferred call
BUS/110.
BUSINESS
wiseman 2026/2027 BUSINESS
, FIN 101 Midterm 2 Exam
questions with correct answers
2026/2027 Edition Graded A+
1.What condition must exist if a bond's coupon rate is to equal both
the bond's current yield and its yield to maturity - ✅✅D. The bond
must be priced at par.
2.What is the principal amount of a bond that is repaid at the end of
the loan term called - ✅✅E. Face value
3.A bond's annual interest divided by its face value is referred to as the
- ✅✅C. coupon rate.
4.The market-required rate of return on a bond that is held for its
entire life is called the - ✅✅B. yield to maturity.
5.The current yield on a bond is equal to the annual interest divided by
the - ✅✅D. current market price.
, 6.The written agreement that contains the specific details related to a
bond issue is called the bond - ✅✅A. indenture
7.A registered-form bond is defined as a bond that - ✅✅C. pays
coupon payments directly to the owner of record.
8.This morning, Jeff found an aged bond certificate lying on the
street. He picked it up and noticed that it was a 50-year bond that
matured today. He presented the bond to the bank teller at his local
bank and received payment for both the entire principal and the final
interest payment. The bond that Jeff found must have been which
one of the following? - ✅✅D. Bearer-form bond
9.What term is used to describe an account that a bond trustee
manages for the sole purpose of redeeming bonds early? - ✅✅D.
Sinking fund
10.The call premium is the amount by which the - ✅✅D. call price
exceeds the par value.
11.Russell's has a bond issue outstanding. The issue's indenture
provision prohibits the firm from redeeming the bonds during the first
five years following issuance. This provision is referred to as the _____
provision. - ✅✅D. deferred call
