1. With all things being equal, would you expect to receive a higher or lower interest payment if a bond had a sinking fund?

2. Suppose that a firm is involved in a major litigation and is expected to lose its case, which would cost the firm millions of dollars. Surprisingly, however, the firm wins the case and immediately the stock price jumps. Is the observation of the price increase consistent with the semi-strong form of the efficient market hypothesis? Explain.

3.What factors would impact the price of preferred shares?