6. You are a fund manager wishing to purchase a parcel of bank accepted bills (BABs). In order to pay the lowest price you would accept the you can find from a dealer. A. lowest bid B. highest bid C. lowest offer D. highest offer E. lowest acceptance fee 7. For a number of years, AXA company's share price was around $24 and its earnings per share approximately $2. You determine that its earnings are likely to increase to $2.50 per share this period for various reasons. Which statement is correct? A. The company has a P/E ratio of 12. B. Your P/E analysis suggests the share price will move to $30. C. You would make a buy recommendation. D. You assume that the P/E ratio will remain stable. E. If the change in earnings is permanent, all of these are correct. 8. BSB Company bonds have a coupon rate of 13%, paid semi-annually, a face value of $1,500, and mature at the end of 15 years. What is the current price of this bond if its yield to maturity is 8%? A. $2,142 B. $2,149 C. $3,272 D. $3,834 E. None of the above. 9. An increase in inflationary expectations for the next few years would, all else the same: A. Increase demand for bonds. B. Increase the real interest rate. C. Decrease the supply of bonds. D. Decrease the real interest rate. E. Increase long-term bond yields. 10. If aggregate superannuation fund assets experienced a significant increase over a period of a year the most likely explanation would be: A. Increased payments from contributors. B. Strong positive returns on investments. C. Decreased payments from funds to retirees. D. Reduced fees charged by managers. E. Changes to superannuation tax rules by government