Spring 2020 Version Multiple Choice. 3 point each. Please blacken the circle on the Scantron sheet corresponding to the BEST answer. 1. As a commercial loan customer, I would prefer a loan with because it is less expensive a. daily compounding b. weekly compounding c.level total payments and monthly compounding d. level principal payments e level total payments 2. The market for the first public offering of shares is called the a secondary market b. used market cover the counter market d. broker market e primary market 3. If the general level of interest rates goes up and I am holding a bond with a fixed coupon rate, I would expect the value of my bond to a stay the same b. double Cincrease d. decrease e not enough information to tell 4. If Alex owns 500 shares in a company with cumulative voting and the most votes he can cast for himself in the next board election is 1000 votes, how many board positions are open? a. Five b. Four C. Three d. TWO e. One 5. The Rule of 72's a. Is about doubling the present value to get the future value. b. Says that 72 divided by the payment gives you the number of years to double. c. Says that the rate divided by 72 gives you the number of years to double. d. Both a and b e. Both a and c 6 A perpetuity with a payment of $35,000 per year and a return of 5% would cost you a $1,120,000 b. $2,283,714 C. $1,600,000 d. $700,000 e. $228,571