CHAPTER 17 QUESTIONS

FINANCE  Investment Analysis and Portfolio Management CHAPTER 17 QUESTIONS
 1     Explain the difference between calling a bond and a bond refunding. 


 2.     Identify the three most important determinant of the price of a bond. Describe the effect   of each.   


 3.     Given a change in the level of interest rates, discuss how two major factors will influence   the relative change in price for individual bonds. 


4.     Briefly describe two indenture provisions that can affect the maturity of a bond.  



5.     Explain the differences in taxation of income from municipal bonds, from U.S. Treasury   bonds, and from corporate bonds. 



6.     For several institutional participants in the bond market, explain what type of bond each   is likely to purchase and why.  



    7.     Why should investors be aware of the trading volume for bonds in their portfolio? 


8.     What is the purpose of bond ratings?  



  9.     Based on the data in Exhibit 17.1, which is the fastest-growing bond market in the world?   Which markets are losing market share? 

10.     Based on the data in Exhibit 17.2, discuss the makeup of the Japanese bond market and   how and why it differs from the U.S. market.  


   11.     Discuss the positives and negatives of investing in a government agency issue rather than   a straight Treasury bond.    


12.     Discuss the difference between a foreign bond (e.g., a Samurai) and a Eurobond(e.g., a   Euroyen issue).