Alpha Corp.s bonds have a 30-year maturity, a 10% semiannual coupon, and a par value of $1,000. The going interest rate (r_d) is 4.00%, based on semiannual compounding. What is the bonds price?

		$1,754.12
		$2,005.14
		944.01
		$2,042.83

Jupiter Inc. is evaluating a project that will require $400,000 in assets. The project is financed with 40% debt and 60% equity and is expected to generate earnings before interest and taxes of $90,000. The firm has a tax rate of 20% and pays 3% interest on the debt. What is the ROE (return on equity) for this project?

		17.04%
		21.30%
		35.50%
		28.40%

Which statement regarding bond yields is FALSE?

		All else being equal, if a bonds yield to maturity decreases, its price will increase.
		If the yield to maturity is equal to the coupon rate, a bond will sell at its par value.
		A zero coupon bonds current yield is equal to zero.
		If a bonds yield to maturity exceeds its coupon rate, the bond will sell at premium.

If two constant growth stocks have the same price and the same required rate of return, which of the following statements is correct?

		The stock with the higher dividend yield will have the higher dividend growth rate.
		If one stock has a lower dividend yield, it will also have a higher dividend growth rate.
		The stock with the lower dividend yield with have the lower dividend growth rate.
		The two stocks have the same dividend yield.

Sask Inc.'s cost of equity is 12%. The before-tax cost of debt is 5.50%, and the tax rate is 22%. The target capital structure consists of 40% debt and 60% common equity. What is the companys WACC if all equity is from retained earnings?

		8.20%
		8.92%
		9.40%
		7.72%