51.Otherthingsthesame,bondsarelikelytohavehigherinterestratesiftheyhave a.taxexemptionsandshortterms. b.taxexemptionsandlongterms. c.notaxexemptionsandshortterms. d.notaxexemptionsandlongterms. 52.Otherthingsthesame,whichbondwouldyouexpecttopaythehighestinterestrate? a.abondissuedbytheU.S.government b.abondissuedbyMicrosoftCorporation c.abondissuedbythestateofMontana d.abondissuedbyanewchainofBrazilian-stylerestaurants 53.Otherthingsthesame,whichbondwouldyouexpecttopaythelowestinterestrate? a.abondissuedbyastatewithaverygoodcreditrating b.abondissuedbytheU.S.government c.abondissuedbyafairlynewcompanydoinggeneticresearch d.abondissuedbyNabisco 54.YouarethinkingofbuyingabondfromBluestoneCorporation.YouknowthatthisbondislongtermandyouknowthatBluestone’sbusinessventuresareriskyanduncertain.Youthenconsideranotherbondwithashortertermtomaturityissuedbyacompanywithgoodprospectsandanestablishedreputation.Whichofthefollowingiscorrect? a.ThelongertermwouldtendtomaketheinterestrateonthebondissuedbyBluestonehigher,whilethehigherriskwouldtendtomaketheinterestratelower. b.ThelongertermwouldtendtomaketheinterestrateonthebondissuedbyBluestonelower,whilethehigherriskwouldtendtomaketheinterestratehigher. c.BoththelongertermandthehigherriskwouldtendtomaketheinterestrateloweronthebondissuedbyBluestone. d.BoththelongertermandthehigherriskwouldtendtomaketheinterestratehigheronthebondissuedbyBluestone. 55.Jerryhasthechoiceoftwobonds,onethatpays5percentinterestandonethatpays2percentinterest.Whichofthe following ismost likely? a.The2percentbondismoreriskythanthe5percentbond. b.The5percentbondisaU.S.governmentbond,andthe2percentbondisajunkbond. c.The2percentbondhasalongertermthanthe5percentbond. d.The2percentbondisamunicipalbond,andthe5percentbondisaU.S.governmentbond. 56.Morgan,afinancialadvisor,hastoldherclientsthefollowingthings.Whichofherstatementsisnotcorrect? a.”U.S.governmentbondsgenerallypayahigherrateofinterestthancorporatebonds.” b.”Theinterestreceivedoncorporatebondsistaxable.” c.”U.S.governmentbondshavethelowestdefaultrisk.” d.”Ifyoupurchaseamunicipalbond,youcansellitbeforeitmatures.” 57.Thesaleofstocks a.andbondstoraisemoneyiscalleddebtfinance. b.andbondstoraisemoneyiscalledequityfinance. c.toraisemoneyiscalleddebtfinance,whilethesaleofbondstoraisefundsiscalledequityfinance. d.toraisemoneyiscalledequityfinance,whilethesaleofbondstoraisefundsiscalleddebtfinance. 58.ABCCo.sellsnewlyissuedbonds.JLGCo.sellsnewlyissuedstocks.Whichcompanyisraisingfundsinfinancialmarkets? a.onlyABC b.onlyJLG c.bothABCandJLG d.neitherABCnorJLG 59.Thesaleofbonds a.andstockstoraisemoneyiscalleddebtfinance. b.andstockstoraisemoneyiscalledequityfinance. c.toraisemoneyiscalleddebtfinance,whilethesaleofstockstoraisefundsiscalledequityfinance. d.toraisemoneyiscalledequityfinance,whilethesaleofstockstoraisefundsiscalleddebtfinance. 60.NorthwestWholesaleFoodssellscommonstock.Thecompanyisusing a.equityfinancingandthereturnshareholdersearnisfixed. b.equityfinancingandthereturnshareholdersearndependsonhowprofitablethecompanyis. c.debtfinancingandthereturnshareholdersearnisfixed. d.debtfinancingandthereturnshareholdersearndependsonhowprofitablethecompanyis.