4. The price of a discount bond will increase over time, assuming that the bond's yield to maturity remains constant a. True b. False 5. Which of the following bonds typically has lowest default risk? a. Bonds issued by a US. Corporation b. Bonds issued by the US government c. Bond issued by a foreign corporation d. Municipal bonds 6. Actual retums are always less than expected returns because actual returns are determined at the end of the period and must be discounted back to present value a. True .False 7. Assume that you have S200,000 invested in a stock that is returning 14%. S300,000 invested in stock that is returning 18%, and S400.000 invested in a stock that is returning 15%, what is the expected return of your portfolio? A) 13.25% B) 14.97% C) 15.25% D) 15.78% 8, Marble Corp. has a beta of 2.5 and a standard deviation of returns of 20%. The return on the market portfolio is 15% and the risk free rate is 4%. According to CAPM, what is the required rate of return on Collectible's stock? A) 37.5% B) 31.5% C) 26.5% D) 23.5%