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Identify the rule, formula, or decision criterion before reading the answer choices. CFA Level I distractors often use the right vocabulary with the wrong condition.
Fixed Income
7. Yield and Yield Spread Measures for Fixed-Rate Bonds practice questions
7. Yield and Yield Spread Measures for Fixed-Rate Bonds is part of CFA Level I Fixed Income. Fixed Income questions focus on bond cash flows, yield measures, duration, convexity, credit risk, securitization, and curve interpretation. Use this page to review the controlling ideas, then work through 8 questions with answer explanations and common traps.
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Fixed Income
7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A bond has a stated annual yield of 6.0% compounded semiannually. The effective annual yield is closest to:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A 7-year corporate bond has a yield to maturity of 5.80%. The interpolated 7-year government benchmark yield is 4.25%. The corporate bond's G-spread is closest to:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A bond with a par value of 100 pays a 6.0% annual coupon and is priced at 95.00. The bond's current yield is closest to:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
The current yield of a fixed-rate bond is best calculated as annual coupon divided by:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
For a callable bond with several possible call dates, yield-to-worst is best described as the:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A bond pays a 5% coupon semiannually, is priced at 102, and is callable in three years at 101. The bond's yield-to-call is closest to:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A bond has a stated annual yield of 5.80% compounded semiannually. The effective annual yield is closest to:
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7. Yield and Yield Spread Measures for Fixed-Rate Bonds
A corporate bond has a 4.30% yield-to-maturity. The interpolated government benchmark yield at the same maturity is 3.55%. The G-spread is closest to:
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