1. Which of the following statements is true? a) Bonds represent ownership in a company. b) Companies have a legal right to pay interest to their shareholders. c) A firm's stock price depends in part on its future cash flows d) A stock's "true" value is known as its market price. 2. How much would you need in an account today that pays 8% interest in order to $100,000 in five years? 3. With a (an). original issuer of the security. a) initial public offering b) secondary market c) both a) and b) d) neither a) nor b) transaction, no new funds are generated for the 4. Moe's Tavern's bonds will mature in 20 years. The bonds have yield to maturity 8%, face value $1000, and 7% coupon rate paid semiannually. Find the price of the bonds. 5. One reason a privately held company may decide to issue stock to the public is to a) Have access to a large amount of capital b) Avoid mandatory financial disclosures c) Give management more control over the company d) Maintain privacy 6. Most large companies that trade publicly have their shares listed on an exchange. The two major stock exchanges in the US are the: a) S&P 500 Index and NASDAQ Composite Index b) NYSE and Dow Jones Industrial Average c) NYSE and S&P 500 Index d) NYSE and NASDAQ 7. Assume the risk free rate is 5% and that the expected return on the market portfolio is E certain stock has a beta of 0.8. What is the required return on the stock? 8. True or False: Stocks with higher betas should have higher prices, all else equal. Justif answer. Suppe o cost of in wo