A Treasury Bond Due in One Year Has a Yield

question 118

Multiple Choice

A Treasury bond due in one year has a yield of 4.6%; a Treasury bond due in 5 years has a yield of 5.6%.A bond issued by Lucent Technologies due in 5 years has a yield of 8.9%; a bond issued by Exxon due in one year has a yield of 6.2%.The default risk premiums on the bonds issued by Exxon and Lucent Technologies,respectively,are:

• A)1.6% and 3.3%
• B)0.5% and 0.7%
• C)3.3% and 1.6%
• D)0.7% and 0.5%
• E)none of the above

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Definitions:

Cultural Control

Cultural control refers to the ways in which society uses norms, laws, and social institutions to regulate individuals' behavior and maintain social order.

Sanctions

Measures taken by countries or international bodies against a state or individual to compel obedience to law or punish for violations.

Genocide

The physical extermination of one people by another, either as a deliberate act or as the accidental outcome of activities carried out by one people with little regard for their impact on others.

Adjudication

The legal process by which an arbiter or judge reviews evidence and arguments to make a formal decision or judgement in a dispute.