1. A semiannual corporate bond has a face value of $1,000, a yield to maturity of 10 percent, and a coupon rate of 8 percent. The bond matures 3 years from today. This bond: A. pays interest payments of $80 every six months. B. sells at par value. C. is currently quoted at a price of 97.20. D. has a current yield of 8.43 percent. E. sells for 960.14 2. A company has earnings per share of $2. If its stock price is $40 per share, what is its PE ratio? A. 80 B. 40 C. 30 D. 20 E. 2 3. One year ago, you purchased a stock at $50 a share. You received an annual dividend of $1 a share and sold the stock today for $46 a share. What was your rate of return? A. -4.8% B. -5.6% C. -6% D. -8% E.-12% 4. Which of the following are characteristics of a DISCOUNT bond? I. As market interest rate increases, bond price will also increase. I. As market interest rate increases, bond price will decrease. III. coupon rate current yield A. I only B. I and III only C. I and IV only D. II and III only E. II and IV only 5. Which of the following statements are correct if a firm decreases its current liabilities? Assume all ratios have positive values. I. Increase in the current ratio. II. Increase in the cash ratio. III. Decrease in the net working capital. IV. Decrease in the quick ratio. A. I only B. I and II only C. I and IV only D. II and III only E. II and IV only