1. A bond is:
    An IOU
    An ownership stake
    A form of cash
2. Stocks always outperform bonds.
    True
    False
3. You can never lose money in the bond market.
    True
    False
4. The safest bonds of all are:
    High-yield bonds
    Municipal bonds
    U.S. Treasury bonds
5. Inflation is a bond investor's...
    Friend
    Foe
6. When interest rates rise, bond prices:
    Rise
    Fall
    Stay the same
7. If interest rates rise by 1 percentage point, which $10,000 bond with a 6% coupon rate would get hurt the worst?
    A one-year bond
    A 10-year bond
    A 30-year bond
8. If you invest in a bond with a $1,000 par value that pays a $70 coupon you will earn:
    7%
    3.5%
    It depends on how much you paid for it, and whether or not you hold it to maturity
9. The interest you earn on a municipal bond will be totally tax-free:
    If you live in the state issuing the bond
    If you *don't* live in the state issuing the bond
    No matter where you live
10. A bond mutual fund works just like a bond.
    True
    False