1.If a person s required return increases as risk increases, that person is said to be

A. risk-seeking B. risk-indifferent C. risk-averse D. risk-aware

2. Risk that remains even if the portfolio holds every stock in the market is known as diversifiable risk

True

False

3. A firm has an issue of $1000 par value bonds with a 12 percent stated interest rate outstanding. The issue pays interest annually and has 10 years remaining to its maturity date. If bonds of similar risk are currently earning 16 percent, the firm's bond will sell for ______ today.

		A. $940
		B. $807
		C. $896
		D. $1,268