fixed-income — CFA Level I Practice Questions

64 free CFA Level I questions on fixed-income: 28 easy, 27 medium, and 9 hard, every one exam-realistic and fully explained once you sign in. This is the fastest way to turn fixed-income from a weakness into a scoring area — drill it in 10-question reps with immediate feedback.

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1. A 5-year, 6% semiannual coupon bond has a Macaulay duration of 4.4 years and a yield-to-maturity of 6%. Its mo
2. In the calculation of Macaulay duration, the weights (w_t) applied to each time period t sum to:
3. If all other factors remain constant, which of the following changes will decrease the Macaulay duration of a
4. For a Vesper Foods bond with a modified duration of 4.5, a 20 basis point increase in yield will result in a p
5. Macaulay duration is measured in units of ________, while modified duration is measured in units of ________.
6. A bond's price increases more when yields fall by 100 bps than it decreases when yields rise by 100 bps. This
7. Which of the following is synonymous with the 'dirty price' of a Vesper Foods bond?
8. If the yield is 0%, what is its modified duration?
9. A bond pays a $30 semiannual coupon. If the BA II Plus is used to find the price, and N is set to the number o
10. A Helion Rail semiannual-pay bond has a Macaulay duration of 12.0 years and a yield-to-maturity of 6.0%. The m
11. What is the invoice price?
12. A Helion Rail bond has a dirty price of 92.50 and a flat price of 91.80. The accrued interest is:
13. Helion Rail has issued a callable corporate bond currently trading at 102.50. Using a valuation model, an anal
14. Helion Rail's treasury department is using effective duration to hedge a liability. If the hedge is based on m
15. Meridian Pack is analyzing a bond with a 6% duration and a 50 convexity. If yields decrease by 100 basis point
16. A portfolio manager at Meridian Pack notes that during a market rally, a callable bond's price rises less than
17. Meridian Pack is considering issuing a 'convertible' bond. When calculating the effective duration of a conver
18. A 10-year, 4% annual coupon bond is priced at 92.50 to yield 5.00%. If the yield increases by 50 basis points
19. Vesper Foods issues a bond at par with a 5% coupon. The bond is callable at 102 in three years. As market inte
20. Meridian Pack has a duration gap of +2.5. If market interest rates increase, the investor's realized return ov
21. If the daily yield volatility is 4 basis points (0.04%), what is the estimated 95% one-day parametric VaR?
22. A fixed-income desk at Vesper Foods needs to price a non-traded 4-year, 5% annual coupon bond. They observe tw
23. Helion Rail holds a bond that exhibits negative convexity. This bond is most likely a:
24. Meridian Pack has a bond with modified duration 5.0 and convexity 40. If yields rise from 4% to 5%, the convex
25. A portfolio manager observes that a bond's price increases by 1.20% when yields fall 25 bps and decreases by 1
26. A bond issued by Helion Rail has a Macaulay duration of 7.5 years and a yield-to-maturity of 4.0%. If the yiel
27. A 10-year 5% semiannual-pay bond is currently priced at 98.50. The 'flat price' of the bond refers to:
28. A 30-year bond has a Macaulay duration of 18.5 years. An investor has an investment horizon of 20 years. This
29. An institutional investor at Oakridge Capital has a 5-year investment horizon and holds a Helion Rail bond wit
30. Oakridge Capital is analyzing a 3-year, 5% annual-pay bond yielding 4%. The modified duration is 2.75 and the