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Question
You invested $10,000 ten years ago. During the first two years, you earned 9% per year and during the last eight years, you earned 12% per year. To the nearest dollar, how much is your investment worth today?a. $25,937
b. $29,417
c. $37,014
d. $40,456
e. None of the above
Answer
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Related questions
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Which of the following is not true regarding collateralized mortgage obligations (CMOs)?
a. Interest earned on CMOs is exempt from state income taxes.
b. CMO yields are generally higher than comparable Treasury yields.
c. CMOs exhibit little default risk.
d. All of the above are true.
e. Only a. and c. are true.
Q:
Regulators generally prohibit banks from purchasing ____________ for income purposes.
a. Treasury bills
b. commercial paper
c. common stock
d. repurchase agreements
e. bankers' acceptances
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a. A Hays County general obligation bond to modernize the county fire department.
b. A Lubbock County general obligation bond to build a new sewer plant.
c. A City of San Marcos general obligation bond to pay for street repairs.
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e. A State of Texas bond to finance road repairs.
Q:
Banks can effectively improve their portfolios by:
a. shortening maturities when yields are expected to fall.
b. obtaining less call protection when rates are expected to fall.
c. reducing diversification when the economy is slowing down.
d. increasing bond quality when quality yield spreads are low.
e. all of the above
Q:
An investor can invest in either a tax-exempt security that pays 5% or a taxable corporate security of comparable risk and maturity that pays 8%. At what marginal tax rate will the investor be indifferent between these two securities?
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Q:
The static spread is:
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b. the difference between a fixed-rate yield and a floating-rate yield.
c. the difference between the yield on new Treasury bills versus new Treasury bonds.
d. the difference between expected inflation and the current Treasury bill rate.
e. the difference between the yield on a security with options and the yield on a maturity-matched zero coupon Treasury security.
Q:
Which of the following is not true regarding prepayments?
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c. Mortgages to older people tend to have more prepayments than mortgages to younger people.
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Q:
Eurobonds are subject to fewer regulations than U.S. issued bonds.
Q:
A forward market exchange in foreign currencies is an agreement to exchange:
a. currencies in the future at an unspecified time at an exchange rate determined at the time the contract is agreed to.
b. currencies in the future at a specified time at an unknown exchange rate.
c. currencies in the future at an unspecified time at an unknown exchange rate.
d. a product for a foreign currency in the future at a specified time.
e. currencies in the future at a specified time at an exchange rate determined at the time the contract is signed.
Q:
Non-performing international loans do not completely reflect potential losses because:
a. foreign governments have never defaulted on their debts.
b. banks often loan borrowers funds to make payments on existing loans.
c. U.S. banks can easily recover the funds in foreign courts.
d. the U.S. government has strongly discouraged U.S. banks from making international loans.
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Q:
The risk that a foreign government will suspend debt service payments is known as:
a. LC risk.
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Q:
The first type of international office that a bank forms outside its home country that is exploratory in nature is known as:
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b. a head office.
c. a representative office.
d. an agreement corporation.
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Q:
Historically, what has prevented universal banks from operating in the United States?
a. The Universal Bank Prohibition Act
b. The Glass-Stegall Act
c. U.S. banks have no desire to become universal banks.
d. Universal banks have less risk diversification capabilities than traditional U.S. based banks.
e. a. and c. only
Q:
Which of the following is not a member of the European Community (EC)?
a. France
b. Germany
c. Australia
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Q:
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a. general obligation bonds.
b. credit free bonds.
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d. exempt bonds.
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Q:
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a. 1.6%.
b. 2.0%.
c. 4.0%.
d. 8.0%.
e. 8.6%.
Q:
Prior to the Basle Agreement, primary capital included all of the following except:
a. long-term subordinated debt.
b. common stock.
c. undivided profits.
d. perpetual preferred stock.
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Q:
When increasing liabilities to meet liquidity needs, a bank should consider all of the following except:
a. brokerage fees.
b. required reserves.
c. FDIC insurance premiums.
d. lost interest income.
e. A bank should consider all of the above when increasing liabilities to meet liquidity needs.
Q:
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a. the respondent bank is required to purchase a minimum amount of services.
b. it reduces required reserves.
c. the correspondent bank may be marketing their own services in a local community.
d. it often reduces float.
e. it decreases interest income.
Q:
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b. It now has excess reserves in the amount of $10,000,000.
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d. It is now deficient $9,000,000 in required reserves.
e. There would be no impact on the bank's required reserves.
Q:
Venture capital financing that comes in the "later rounds" of financing may take the form of:
a. start-up capital loans.
b. mezzanine financing.
c. automobile financing.
d. seed money.
e. staff financing.
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What are the firm's estimated working capital needs?a. $90b. $540c. $630d. $1,170e. $2,034
Q:
Loan covenants:
a. protect the borrower from lender interference in management.
b. are limited to "negative" provisions.
c. may limit discretionary cash outlays by borrowers.
d. are seldom enforced.
e. often result in the lender's bankruptcy.
Q:
In the credit process, which of the following activities falls under Credit Execution and Administration?
a. Financial statement analysis
b. Evaluate collateral
c. Officer call programs
d. Review loan documentation
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Q:
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a. International risk
b. Foreign risk
c. Continent risk
d. Country risk
e. Government risk
Q:
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Q:
In regards to repurchase agreements, the margin is:
a. a good faith deposit.
b. a loan against the repurchase agreement.
c. a risk-free guarantee.
d. the difference between the market value of the collateral and the amount of the loan.
e. all of the above.