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Bonds 103: Buying Bonds

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1.
The highest credit rating a bond can receive is _______.
Choose wisely. There is only one correct answer.
AAA. AAA is the highest credit mark a bond can receive.
2.
A bond unit investment trust is an actively managed portfolio of bonds.
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False. A unit investment trust is managed, and is a fixed portfolio of securities.
3.
New US Treasury bonds are offered only four times a year.
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True. You can only buy bonds directly from the Federal Reserve during the first half of February, May, August, and November.
4.
The more bonds you buy in one sale, the less you will pay in markup costs.
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True. Markups are generally lower for large sales than for small ones.
5.
The face value of a bond is known as its _______.
Choose wisely. There is only one correct answer.
Par. In bond language, par means face value.