Most bonds pay coupon interest

a.

b.

c.

d.

Question 1 options:

semi-annually

monthly

quarterly

annually

Question 2(10 points)

A company has 10 million shares outstanding and a stock price of $89.25. What is this company's market capitalization?

Question 2 options:

$89,250,000,000

$89,250,000

$892,500

$892,500,000

Question 3(10 points)

At your discount brokerage firm, it costs $9.95 per stock trade. How much money do you need to buy 100 shares of Amazon, which trades at $85.13?

Question 3 options:

$8,503.05

$8,503.00

$8,522.95

$9,508.00

Question 4(10 points)

A company has earnings per share of $3.75 and P/E of 47. What is the stock price?

Question 4 options:

$174.08

$176.25

$185.95

$112.98

Question 5(10 points)

A corporation's 10-year bonds have an equilibrium rate of return of 7 percent. For all securities, the inflation risk premium is 1.50 percent and the real interest rate is 3.0 percent. The security's liquidity risk premium is 0.15 percent and maturity risk premium is 0.70 percent. The security has no special covenants. What is the bond's default risk premium?

Question 5 options:

1.65%

5.35%

9.35%

1.40%

Question 6(10 points)

One-year Treasury bills currently earn 5.50 percent. You expect that one year from now, one-year Treasury bill rates will increase to 5.75 percent. If the unbiased expectations theory is correct, what should the current rate be on two-year Treasury securities?

Question 6 options:

5.50%

5.625%

5.75%

11.25%

Question 7(10 points)

Determine the interest payment for the following three bonds: 5.5 percent coupon corporate bond (paid semiannually), 6.45 percent coupon Treasury note, and a corporate zero-coupon bond maturing in 10 years. (Assume a $1,000 par value.)

Question 7 options:

$27.50, $32.25, $0, respectively

$5.50, $6.45, $0, respectively

$27.50, $32.25, $100, respectively

$55.00, $64.50, $0, respectively

Question 8(10 points)

What's the current yield of a 6 percent coupon corporate bond quoted at a price of 101.70?

Question 8 options:

5.9 %

6.0 %

6.1 %

10.2 %

Question 9(10 points)

What's the current yield of an 8.15 percent coupon corporate bond quoted at a price of 94.30?

Question 9 options:

4.30 %

8.64 %

8.01 %

8.15 %

Question 10(10 points)

The largest annual supply of external funds for business corporations comes from issuance of which one of the following sources?

Question 10 options:

preferred stocks

common stocks

bonds

privately placed stocks