Under the variable-ratio plan, additional speculative investments are made when the ratio
A) of conservative investments to speculative investments increases by 10%.
B) of the rate of return on the speculative investments exceeds the overall market return by 1% or more.
C) of the realized rate of return falls below the desired rate of return by 1% or more.
D) of the value of the speculative investments to the total portfolio value drops below a predetermined level.
Answer: D
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Three $1,000 face value, 10-year, noncallable, bonds have the same amount of risk, hence their YTMs are equal. Bond 8 has an 8% annual coupon, Bond 10 has a 10% annual coupon, and Bond 12 has a 12% annual coupon. Bond 10 sells at par. Assuming that interest rates remain constant for the next 10 years, which of the following statements is CORRECT?
A. Bond 8's current yield will increase each year. B. Since the bonds have the same YTM, they should all have the same price, and since interest rates are not expected to change, their prices should all remain at their current levels until maturity. C. Bond 12 sells at a premium (its price is greater than par), and its price is expected to increase over the next year. D. Bond 8 sells at a discount (its price is less than par), and its price is expected to increase over the next year. E. Over the next year, Bond 8's price is expected to decrease, Bond 10's price is expected to stay the same, and Bond 12's price is expected to increase.
When the inflation rate is expected to increase, the expected return on bonds relative to real assets falls for any given interest rate; as a result, the ________ bonds falls and the ________ curve shifts to the left
A) demand for; demand B) demand for; supply C) supply of; demand D) supply of; supply
In the context of the core values identified by the Character Counts organization, being honest, not deceiving, cheating, or stealing, and doing what you say you'll do represent the universal ethical standard of _____.
A. trustworthiness B. responsibility C. citizenship D. fairness
What does it mean if an auction is with reserve?
A. Unless otherwise stated, the auctioneer has the right to withdraw the item before the fall of the hammer. B. The auctioneer must sell to the highest bidder. C. Even after the fall of the hammer, the auctioneer can accept other bids. D. The items for sale have a minimum price.