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FIN 601 Bond Markets - FSS 2020 Exam T2 with solution
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FIN 601 Bond Markets - FSS 2020 Second-date Exam with detailed solution. The course was delivered by Prof. Theissen.
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FIN 601 Bond Markets - FSS 2020 Exam T1 with Solution
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PROF. DR. ERIK THEISSENFINANCE AREA
Exam Bond Markets
Course FIN601, FSS 2020
19.09.2020 (1)
Last name:
First name:
Student ID:
1. Enter your last name, first name and student ID above.
2. If you have any technical questions or issuers at any point throughout the exam, please
immediately either use the ZOOM link provided below or call the phone number provided
below to get directly connected to us.
3. Both the ZOOM link and the telephone hotline are only intended for technical problems. In order
to avoid congestion of the channels, please note that we will not answer any questions regarding
the contents of the exam.
4. After you are done with the exam and before the submission deadline (15:20), save the exam in
pdf format as FIN601_{Your Student ID}.pdf (one document only) and submit it via the “Exam
FIN 601” ILIAS group.
a. In case of any problems immediately use the ZOOM session or phone number to inform
us.
b. If we receive no information from you on technical difficulties that you are facing within
the time frame of the exam, your exam will be graded.
c. Only(!) in case your submission via ILIAS fails, send an email with your solution file to
theissen@uni-mannheim.de within the deadline.
5. Please note that the examination time is 60 minutes. The additional 20 minutes ensure that there
is sufficient time for the download of the exam and the upload of your solution. Please note that
the submission deadline 15:20 is a super-strict deadline.
6. You can only upload one document. When you want to upload a new file you will first have to
delete the old file.
7. Please do not change font sizes and the formatting of this exam booklet
● ZOOM link: https://uni-mannheim.zoom.us/j/3581360857
● Phone number: +49 (0) 621 181-1525
● Email: theissen@uni-mannheim.de
, PROF. DR. ERIK THEISSEN
FINANCE AREA
Please answer all of the following five questions. The maximum number of points is 37. The
maximum number of points for each question is shown in parentheses.
Please explain your answers. If not indicated otherwise, numbers should be rounded to four digits
after the decimal point.
Question 1 (10 points)
Below you find ten statements. Please indicate clearly and unanimously whether the
statements are true or false by putting an "X" in the appropriate place, i.e. "True: X" or
"False: X".
Please explain your answer briefly (one or two sentences). Without a valid explanation, no
points will be awarded.
1. Consider two default-free coupon bonds with the same time to maturity. Both bonds are
fairly priced. The term structure is flat. Then it will always be true that the two bonds
have the same yield to maturity.
True: False:
2. An investor can choose between several bonds. Choosing the bond with the highest
yield to maturity will always yield the highest net present value for the investor.
True: False:
3. The current yield of a zero bond is always zero.
True: False:
4. If the liquidity preference hypothesis of the term structure holds, the implied forward
rate between periods 1 and 2 is always smaller than the expected one-year spot rate one
year from now.
True: False:
5. The convexity of a bond always depends on the market interest rate.
True: False:
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