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Security Valuation MCQs

Free 16+ Security Valuation MCQs for PPSC, FPSC, NTS, and Pakistan government job tests. Practise below with answers and explanations.

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16 questions in this list. Select an option to practice, or open a question for the full page with explanation.

Security Valuation — MCQs for Pakistan government job tests

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Security Valuation

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1.Which term describes the inverse correlation between fluctuations in price and changes in interest rates?

2.Which term describes the direct correlation between fluctuations in price and changes in interest rates?

3.For zero-coupon bonds, how does the duration change as the maturity lengthens?

4.What is the classification of a bond whose present market value exceeds its face value?

5.What is the term for the interest rate that investors expect to earn on a financial asset when determining its fair value?

6.Which type of bond is issued without periodic interest payments?

7.What term describes the weighted average period until an investment matures?

8.What term describes the percentage change in a bond's present value resulting from a given change in interest rates?

9.Which category of bonds provides periodic coupon payments to investors?

10.What is the term for the duration divided by one plus the interest rate?

11.When will holders of a coupon bond receive cash payments more quickly?

12.How does an increase in the coupon or promised interest payment affect a bond's duration?

13.How does an increase in duration affect the maturity of zero-coupon bonds?

14.What term describes the percentage change in interest rate resulting from a specific change in interest rate?

15.How does a decreased duration affect the maturity of zero coupon bonds?

16.Which category of bond has a current value that is lower than its nominal (face) value?

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