1.

Which of the following numbers takes into consideration repayment of the Face Value of the bond?

		Coupon Rate
		Current Yield
		Yield to Maturity

2.

You have a bond that you purchased at a discount. This bond has a ten year maturity, but is currently callable. If the bond was called prior to maturity, what would it do to your Yield to Maturity?

		Decrease the YTM
		Have no effect on the YTM.
		Increase the YTM

3.

The Board of Directors of Challenger, Inc. has authorized 40,000 shares of stock at a price of $10/share. Currently, there are 25,000 shares issued with 20,000 outstanding. If Challenger, Inc wanted to raise more capital, how much capital could it raise by issuing new shares?

		$150,000
		$250,000
		$200,000
		$450,000

4.

You can purchase a Zero Coupon bond with a face value of $1,000. The bond matures in eight years with a coupon rate of 7%. How much would you pay for this bond?

		$582.01
		$608.34
		$572.62
		$497.39

5.

Voyager, Inc. has issued bonds with a ten-year maturity that are paying a coupon of 8%. Rates have risen since this issuing, so the bond is selling at a discounted price of $925. What is the Yield to Maturity?

		5.5%
		4.58%
		11%
		9.16%

6.

Voyager, Inc. has issued bonds with a twelve-year maturity that are paying a coupon of 9%. Rates have risen since this issuing, so the bond is selling at a discounted price of $950. The bond is three years old and can be called after the bond is six years old. What is the Yield to Maturity?

		11%
		5.5%
		4.93%
		9.85%

7.

PowerTech Co. has issued bonds with a ten-year maturity that are paying a coupon of 4%. Rates have risen since this issuing, so the bond is selling at a discounted price of $975. The bond is five years old. What is the Yield to Maturity?

		4.56%
		2.16%
		4.31%
		2.28%