1) A firm issues $1,000 par value, 15-year bonds pay a 7.00% semi-annual coupon. If the current market for debt of this type is 6.00% how much would you be willing to pay for one of these bonds?

Select one:

a. $1,098.00

b. $1,024.87

c. $1,784.02

d. $1,000.00

e. $1,097.12

2) You're considering an investment in 12-year, $1,000 face value bonds with a 9.00% coupon paid semi-annually and a yield to maturity of 7.00%. The bonds are callable in three years at a call price of $1,045. If you believe that the bonds will be called how much will you earn?

Select one:

a. 4.62%

b. 4.64%

c. 4.82%

d. 4.91%

e. 3.33%

3) A preferred share recently paid an annual dividend of $8.00. Investors require a 14.00% return. The firm's tax rate is 25% and is expected to experience growth of 8.00%. How much should investors be willing to pay?

Select one:

a. $57.14

b. $61.71

c. $46.29

d. $100.00

e. $108.00

4) Which of the following from the Reading, The Case for Non-Voting Stock are true?

• The S&P Dow Jones Indices do not, in most circumstances, include companies with multiple classes of stock.
• The traditional view is that multiple classes of stock insulate the firm from the shareholder influence.
• Firms that have made use of dual class structures include Google, Facebook and Snap Inc.

Select one:

a. One of the above is true

b. Two are true

c. All are true

d. None are true