Test Bank for Statistics for Business and Economics
8th Edition All Chapters 1 - 17 / Full Complete
corporate bonds are backed by - ANSWERScorporation
municipal bonds are backed by - ANSWERScity and local governments
agency bonds are backed by - ANSWERScorporate BACKED by government
U.S. Treasury bonds are backed by - ANSWERSthe government (most trustworthy)
The local governments want to build a new bridge to connect two parts of a growing city. Which
type of bond would a local government issue? Why? - ANSWERSmunicipal
backed by cities and local governments
A home mortgage company backed by the government wants to raise money for more first time
home mortgage loans. Which type of bond would the government sponsored agency issue?
Why? - ANSWERSAgency
backed by the government
An investor wants to make the safest possible bond investment and plan to collect the interest
for ten years. Which type of bond should the investor purchase? Why? - ANSWERSU.S. Treasury
safest/most trustworthy, they have a 10 year maturity period
A large corporation wants to expand into Asian markets. They want to issue a bond and a plan
to guarantee the bond with land holdings in Latin America, so what type of bond would they
issue? Why? - ANSWERScorporate bond
these bonds are backed by specific corporate assets, like property and equipment
,A major corporation wants to issue a bond; they have a reputation for being a trustworthy
company. They want to use their credit rating to guarantee the bond. What type of bond would
they issue? Why? - ANSWERScorporation
backed by general credit of the corporation
An investor wants to support the increase of water power in America and would like to
purchase a bond from the Tennessee Valley Authority. What type of bond would he purchase?
why? - ANSWERSAgency
Tennessee Valley Authority issues bonds to raise funds under Agency Bonds
How is a bond like an IOU? - ANSWERSYou loan money, and later you'll get it back
Why is an investment grade bond considered a "safe" investment? - ANSWERSCorporations and
governments that are deemed trustworthy issue them
How can an investor make money by buying a bond? - ANSWERSThey get paid interest when
they get their return
Corporate Bonds (definition from worksheet) - ANSWERSBonds are major sources of corporate
borrowing. he most common type of corporate bonds are backed by the general credit of the
corporation. Asset-backed bonds are backed by specific corporate assets, such as property or
equipment
Municipal Bonds (definition from worksheet) - ANSWERSMillions of bonds have been issued by
state and local governments. General obligation bonds are backed by the full faith and credit of
the ISSUER. Revenue bonds by the income generated by the particular project being financed
Agency Bonds (definition from worksheet) - ANSWERSSome government sponsored
corporations are privately owned (like Fannie Mae and Freddie Mac) and certain federal
, government agencies (like Ginnie Mae and Tennesee Valley Authority) issue bonds to raise
funds either to make loan money available or to pay off new projects
U.S. Treasuries (definition from worksheet) - ANSWERSTreasury notes: an intermediate-term
obligation of the U.S. Treasury having a maturity period of one to ten years and paying interest
semiannually. Bills, are short-term obligations of the U.S. Treasury having a maturity period of
one year or less and sold at a discount from face value
4 factors of production + 1 example of each - ANSWERSLand-oil
Labour-builders
Capital-machinery
Enterprise-Bill gates
3 types of economic systems - ANSWERSCentrally planned economy
Free enterprise economy
Mixed economy
Economic growth - ANSWERSThe change in the number of goods and services produced in a
country from one year to the next
GNP - ANSWERSGross national product
CPI - ANSWERSConsumer price index
Calculate the rate of economic growth - ANSWERSDifference/original x 100/1=%
2 benefits of economic growth - ANSWERSNew jobs so the number of unemployment decreases
People enjoy a higher standard of living because they have more money to spend
8th Edition All Chapters 1 - 17 / Full Complete
corporate bonds are backed by - ANSWERScorporation
municipal bonds are backed by - ANSWERScity and local governments
agency bonds are backed by - ANSWERScorporate BACKED by government
U.S. Treasury bonds are backed by - ANSWERSthe government (most trustworthy)
The local governments want to build a new bridge to connect two parts of a growing city. Which
type of bond would a local government issue? Why? - ANSWERSmunicipal
backed by cities and local governments
A home mortgage company backed by the government wants to raise money for more first time
home mortgage loans. Which type of bond would the government sponsored agency issue?
Why? - ANSWERSAgency
backed by the government
An investor wants to make the safest possible bond investment and plan to collect the interest
for ten years. Which type of bond should the investor purchase? Why? - ANSWERSU.S. Treasury
safest/most trustworthy, they have a 10 year maturity period
A large corporation wants to expand into Asian markets. They want to issue a bond and a plan
to guarantee the bond with land holdings in Latin America, so what type of bond would they
issue? Why? - ANSWERScorporate bond
these bonds are backed by specific corporate assets, like property and equipment
,A major corporation wants to issue a bond; they have a reputation for being a trustworthy
company. They want to use their credit rating to guarantee the bond. What type of bond would
they issue? Why? - ANSWERScorporation
backed by general credit of the corporation
An investor wants to support the increase of water power in America and would like to
purchase a bond from the Tennessee Valley Authority. What type of bond would he purchase?
why? - ANSWERSAgency
Tennessee Valley Authority issues bonds to raise funds under Agency Bonds
How is a bond like an IOU? - ANSWERSYou loan money, and later you'll get it back
Why is an investment grade bond considered a "safe" investment? - ANSWERSCorporations and
governments that are deemed trustworthy issue them
How can an investor make money by buying a bond? - ANSWERSThey get paid interest when
they get their return
Corporate Bonds (definition from worksheet) - ANSWERSBonds are major sources of corporate
borrowing. he most common type of corporate bonds are backed by the general credit of the
corporation. Asset-backed bonds are backed by specific corporate assets, such as property or
equipment
Municipal Bonds (definition from worksheet) - ANSWERSMillions of bonds have been issued by
state and local governments. General obligation bonds are backed by the full faith and credit of
the ISSUER. Revenue bonds by the income generated by the particular project being financed
Agency Bonds (definition from worksheet) - ANSWERSSome government sponsored
corporations are privately owned (like Fannie Mae and Freddie Mac) and certain federal
, government agencies (like Ginnie Mae and Tennesee Valley Authority) issue bonds to raise
funds either to make loan money available or to pay off new projects
U.S. Treasuries (definition from worksheet) - ANSWERSTreasury notes: an intermediate-term
obligation of the U.S. Treasury having a maturity period of one to ten years and paying interest
semiannually. Bills, are short-term obligations of the U.S. Treasury having a maturity period of
one year or less and sold at a discount from face value
4 factors of production + 1 example of each - ANSWERSLand-oil
Labour-builders
Capital-machinery
Enterprise-Bill gates
3 types of economic systems - ANSWERSCentrally planned economy
Free enterprise economy
Mixed economy
Economic growth - ANSWERSThe change in the number of goods and services produced in a
country from one year to the next
GNP - ANSWERSGross national product
CPI - ANSWERSConsumer price index
Calculate the rate of economic growth - ANSWERSDifference/original x 100/1=%
2 benefits of economic growth - ANSWERSNew jobs so the number of unemployment decreases
People enjoy a higher standard of living because they have more money to spend
