Which of the Following Securities Will Likely Have the Highest

question 95

Multiple Choice

Which of the following securities will likely have the highest liquidity premium?

• A)U.S.Treasury Bond maturing in 2027
• B)BBB-rated corporate bond maturing in 2020 actively traded on a major exchange
• C)AAA-rated corporate bond maturing in 2015 not actively traded
• D)U.S.Treasury Bill

---

Definitions:

Ending Capital

Beginning Capital + Additional Investments + Net Income – Withdrawals = Ending Capital. Or: Beginning Capital + Additional Investments – Net Loss – Withdrawals = Ending Capital.

Worksheet

A document used by accountants to gather information from financial statements, adjust and close entries, and prepare financial statements.

Plant, Property

Plant, Property, often followed by and Equipment (PP&E), represents long-term assets owned by a company, used in its operations.

Equipment

Tangible assets used in operations, such as machinery or office equipment, not intended for sale.