Chapter 7 Fixed Income Securities Flashcards
1
Q
Commercial paper
A
$100,000 denominations
typically mature 270 days or less
2
Q
Accrued interest
A
semiannual coupon pmt x (days since last coupon payment/days in coupon period)
3
Q
STRIPS
A
treasury bond or note that has principal and payment taken out and sold separately as zero coupon bonds
4
Q
TIPS
A
Pay interest at a fixed rate
principal is adjusted for inflation every six months
5
Q
EE and I bonds
A
sold at face value and accrue interest
not subject to OID
I bonds adjust for inflation
6
Q
Tax equivalent yield
A
tax-exempt yield/1-marginal rate
7
Q
After tax return
A
taxable return x 1-marginal rate
8
Q
A
