Hart Fixed Income Exam Questions and Correct Answers.

Hart Fixed Income Exam Questions and
Correct Answers
Question 1
Which is larger, US bond market or US stock market?
Correct Answer
- US Bond Market: 54 trillion (compared to stock market 46 trillion)



Question 2
The distinction between investment grade debt and non-investment grade debt is
best described by the differences in:
Correct Answer
Credit Quality



Question 3
Who had one of the worst bouts of inflation ever?
Correct Answer
Germany in 1922



Question 4
What is the Equation of Exchange?
Correct Answer
-PxQ=MxV



Question 5
What is most of the intergovernmental holdings?
Correct Answer
- Social Security, more people use it and pay into it




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,Question 6
What is U-3 Participation Rate?
Correct Answer
Labor force is the people who have a job or have looked for a job within the past
month



Question 7
What is the central bank?
Correct Answer
- In charge of monetary policy
- Manipulating the money supply to affect interest rates



Question 8
When did the whole world go on fiat currency?
Correct Answer
8/15/1971 Nixon closes the gold window and whole world on fiat currency



Question 9
What is the only guaranteed rate on the T-Bills?
Correct Answer
US 1 year



Question 10
Which of the following is a type of external credit enhancement?
Correct Answer
A surety bond




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,Question 11
A repurchase agreement is most comparable to a(n):
Correct Answer
Collateralized loan



Question 12
What is Quantitative Easing?
Correct Answer
- The introduction of new money into the money supply by a central bank
- We are now reversing to quantitative tightening



Question 13
In anywhere but the US, LIBOR is called...
Correct Answer
Eurodollar



Question 14
What kind of treasury has the most treasuries outstanding?
Correct Answer
- T-Notes (2-10 years)



Question 15
Post-2008...
Correct Answer
- Monetary: FF down
- QE: monetizing the debt




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, Question 16
What is SOFR?
Correct Answer
Secured Overnight Financing Rate. This is secured and replacing LIBOR



Question 17
How do we currently stand for M and V?
Correct Answer
- M at all time highs, V at all time lows



Question 18
How long have been accumulating the current debt in the United States?
Correct Answer
- Since 1836 when Andrew Jackson paid it off



Question 19
Which type of sovereign bond has the lowest interest rate risk for an investor?
Correct Answer
Floaters



Question 20
When was the bimetallic dollar standard?
Correct Answer
1792-1900



Question 21
In major developed bond markets, newly issued sovereign bonds are most often sold
to the public via a(n):
Correct Answer
Auction




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