18. You've assembled the following portfolio: Expected return Portfolio weight Beta Stock 0.2 1.3 0.085 0.6 1.1 0.075 0.2 0.4 0.04 What is the beta of the portfolio? C. 1.0 D. 1.1 B. 0.75 A. 0.075 19. Which of the following statement about risk is NOT correct? A. Diversifiable risk, asset-specific risk and unique risk are synonyms to unsystematic risk B. Decrease in corporate tax rates is an example of systematic risk C. higher total risk is compensated with higher average (expected) return D. A firm's warehouse fire is an example of unsystematic risk 20. A $1,000 face value bond currently has a yield to maturity of 6.69 percent. The bond matures in three pays interest annually. The coupon rate is 7 percent. What is the current price of this bond? A. $949.60 B. $1,005.26 C. $1,008.18 D. $1,010.13 21. Which statement about the term structure of interest rates is NOT correct? A. plots spot rates as a function of maturities B. usually is upward sloping, but can take many shapes from time to time C. is humped when intermediate-term pure discount bonds have a lower return than either the short longer-term bonds D. is flat if all spot rates are the same. 22. A 5.5% coupon, semiannual-pay, five-year bond has a yield to maturity of 6.80%. Over the next year, yield to maturity remains unchanged, its price will: A. increase. B. decrease. C. remain unchanged. D. not enough information to determine 23. A 3-year coupon bond, issued at $946.54, pays annual coupon and has a face value of $1000. Use the amortization table below to answer questions 23-1 to 23-3 Period Coupon Interest Revenue Balance Addition Carrying Balance $946.54 $40.00 $40.00 $40.00 $16.79 $963.33 Cell E4 3 $58.87 $1,000.00 23-1. What is the YTM of this bond when issued? A. 3% C. 5% B. 4% D. 6% E. 7%