ANALYTICS AND DECISION MAKING
ASSESSMENT STUDY GUIDE COMPLETE
QUESTIONS AND ANSWERS
◉ Types of Bonds. Answer: Treasuries, agency debt, corporate
bonds, municipal bonds, foreign bonds
◉ Treasuries. Answer: U.S. government debt
◉ Agency Debt. Answer: issued by U.S. government agencies
◉ Corporate Bonds. Answer: Issued by corporations and evaluated
by credit risk
◉ Municipal Bonds. Answer: Issued by the state and local
governments, interest is tax exempt
◉ Foreign Bonds. Answer: Issued by foreign countries or
corporations
, ◉ Types of Legal Forms of Business Organizations. Answer: sole
proprietorship, partnership, corporation
◉ Types of partnerships. Answer: LP, LLP, LLC
◉ What is corporate value determined by?. Answer: Future cash
flows (free cash flows)
◉ Financial Instrument. Answer: A claim on free cash flow
◉ Financial Security. Answer: A standardized claim on free cash flow
that is regulated by government
◉ Types of Claims on FCF. Answer: Debt, equity, derivative, hybrid
◉ Debt. Answer: Claim to specific cash flows at specific times; bond
◉ Equity. Answer: Claim to residual cash flows (after debt claims)
◉ Derivative. Answer: Value is derived from another financial asset;
option