Answer all of these questions with the right question number next to the correct choice (letter).

Q1-You purchase a 2-year, zero-coupon bond for $92,500 and sell it for $100,000 at the end of 2 years. What average APR did you earn on the bond?

A) 8.11%

B) 0.04%

C) 0.08%

D) 4.05%

Q2-How can a U.S. exporter avoid exchange rate risk?

A) Seek to denominate invoices in U.S. dollars

B) Seek to denominate payables in the currency of the off-shore company

C) Seek to denominate invoices in the currency of the off-shore company

D) Seek a loan from an international bank to fund exports

Q5)Why do higher-priced assets bring lower rates of return?

A) The risk on lower-priced assets is higher than on higher-priced assets.

B) The risk on lower-priced assets is lower than on higher-priced assets.

C) There is no relationship between price and rates of return.

D) Higher priced assets bring higher rates of return

Q4)You purchase a 4-year, zero-coupon bond for $80,000 and sell it for $100,000 at the end of 4 years. What average APR did you earn on the bond?

A) 6.25%

B) 0.08%

C) 25.00%

D) 0.04%