If you are borrowing money, would you prefer a loan with an 11.9% annual percentage rate (APR),

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If you are borrowing money, would you prefer a loan with an 11.9% annual percentage rate (APR), compounded daily or a loan with 12% APR, compounded semiannually? Assume 365 days in a year. A. Depends on whether my salary is paid monthly or bi-weekly b. The latter c. the former d. They are equivalent

2. You are purchasing a TV. You can either make five annual installments of $800 beginning next year or pay a cash price of $3,500 today. Assume the prevailing interest rate is 5% per year. How much will you pay?

a. Choose to pay $3,500 now b. They are equivalent c. Choose the installment plan d. Depends on whether I have more income now or in 5 years.

3. How much should you be prepared to pay a 10-year bond with an annual coupon of 7% and a par value of $1000? Assume a prevailing rate of 8%

4. ABC is expected to pay the following dividends per share of common stock for the next two years: $2.5 in year 1 and $2.6 in year 2. Starting from year 3, the dividend will grow at a constant 4% per year. If the discount rate is 13%, what should be the current share price you are willing to pay?

5. What is the present value of a property of $5000 per year beginning today? Assume a 11% prevailing interest rate.

6. The expected first-year dividend is $0.84 for Gene America Inc. The future dividends are expected to grow at 4% per year forever. With a current stock price of $32.31, the rate of return required by Gene America shareholders is —----%?