Securities with Embedded Options

question 59

Multiple Choice

Securities with embedded options:

• A)often have higher yields than comparable Treasury securities.
• B)generally have no prepayment risk.
• C)are always free of default risk.
• D)all of the above.
• E)a.and b.only

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Definitions:

Gibbons v. Ogden

A landmark Supreme Court case in 1824 that clarified the scope of the U.S. Congress's legislative power over interstate commerce.

Judicial Review

The power of courts to assess whether a law, policy, or executive action is in conflict with the Constitution.

Printz v. United States

A Supreme Court case that held certain interim provisions of the Brady Handgun Violence Prevention Act as unconstitutional, limiting federal power over state officials.

Brady Handgun Violence Prevention Act

A U.S. federal law that mandated federal background checks on firearm purchasers in the United States, and imposed a five-day waiting period on purchases, until the NICS system was implemented in 1998.