Question 5-1 Define each of the following term: A. Bond; Treasury bond; corporate bond; municipal

BA 350 Principles of Finance

BA 350 Week 6 Question 5.1 All Definition


Question 5-1  Define each of the following term:


A. Bond; Treasury bond; corporate bond; municipal bond; foreign bond.

B. Par value; maturity date; coupon payment; coupon interest rate.

C. Floating-rate bond; zero coupon bond; original issue discount bond (oid).

D. Call provision; redeemable bond; sinking fund.

E. Convertible bond; warrant; income bond; indexed, or purchasing power, bond.

F. premium bond; discount bond.

G. current yield (on a bond); yield to maturity (YTM); yield to call (YTC).

H. indentures; mortgage bond; debenture; subordinated debenture.

I. development bond; municipal bond insurance; junk bond; investment-grade bond.

J. real risk-free rate of interest, r*; nominal risk-free rate of interest, rRF

K. inflation premium (IP); default risk premium (DRP); liquidity; liquidity premium (LP)

L. interest rate risk; maturity risk premium (MRP); reinvestment rate risk.

M. term structure of interest rates; yield curve.

N. "normal" yield curve; inverted ("abnormal") yield curve.

 

BA/350 Week 6 Question 5.1