Question: 1. IS THE FOLLOWING STATEMENT TRUE or FALSE? A financial security is simply a contract between the provider of funds and the user of these
1. IS THE FOLLOWING STATEMENT TRUE or FALSE? "A financial security is simply a contract between the provider of funds and the user of these funds that clearly specifies the amount of money that has been provided and the terms and conditions of how the user is going to repay the provider." a. True b. False 2. What's the value to an investor of a $1,000 par value bond with an 8 percent coupon rate when the investor's required rate of return is 15 percent? a. Great than $1000. b. Less than $1000. c. $1,000 d. There is not enough information provided to answer this question. e. None of the answers listed above are always correct. 3. Rigvo Airlines will pay a $4 dividend next year on its common stock, which is currently selling at $100 per share. What is the market's required return on this investment if the dividend is expected to grow at 5% forever? a. 4 percent b. 5 percent c. 7 percent d. 9 percent e. None of the answers listed above are correct
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