Exam (elaborations)
Money and Banking partial examination 2014
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Exam of 33 pages for the course Geld en Bankwezen at UvA
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Available practice questions
Geld en Bankwezen flashcards deeltentamen
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Some examples from this set of practice questions
1.
What are financial intermediaries?
Answer: Institutions that borrow funds from people who have saved and in turn make loans to others
2.
What is the yield to maturity?
Answer: The interest rate that equates the present value of the cash flow payments received from a debt instrument with its value today
3.
What is the face value of a bond?
Answer: The final amount that will be paid when the bond matures
4.
What is a consol (perpetuity)?
Answer: A special bond that has no maturity date and makes no repayment of the principal, but makes fixed coupon payment forever
5.
Does the rate of return on a bond always equals the yield to maturity?
Answer: No.
6.
What is the current yield?
Answer: The coupon payment dividend by the price of the bond on time t=0
7.
What is the rate of capital gain?
Answer: The price at time 1 minus the price at time 0, divided by the price at time 0: (p1-p0)/p0
8.
Which prices and returns are more volatile, those for long-term bonds or those for short-term bonds?
Answer: Long-term bonds
9.
What are the four factors an individual must consider when facing the question whether to buy and hold an asset or whether to buy one asset rather than another?
Answer: Wealth, expected return, risk and liquidity
10.
The quantity demanded of an asset is ..... related to wealth.
Answer: Positively
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