• If a bond is issued at a premium, the coupon interest rate equals:

a.	Annual dollars interest divided by principal
b.	Yield to maturity divided by principal
c.	Annual dollars interest divided by the initial price
d.	Yield to maturity divided by the initial price

• Which of the following statements is correct for a 7% coupon bond that has a yield to maturity of 9%?

a.	The bond currently sells at a premium.
b.	The bond is likely to default.
c.	The bonds price is less than its par value.
d.	The bond will be redeemed for less than $1000

• From the article set on debt, which statement is false?

a.	Americans do not all experience the same rate of inflation
b.	A negative yield curve predicts a recession is coming
c.	Debt rating agencies have changed methods since the GR
d.	US fiscal policy is helping manage the US deficit

• The factor which causes the difference in the return you could earn investing in two year versus five year State of Colorado bonds is the:

a.	Default risk premium
b.	Maturity risk premium
c.	Inflation premium
d.	Liquidity risk premium

• You want to be a millionaire 35 years from now. If you could earn 8% per year on your money, how much would you have to invest every year to achieve the goal?

a.	$85,836.91
b.	$68,000.00
c.	$28,571.43
d.	$5,803.15

• How much return is earned in two years on a $1,000 investment that earns 24% compounded monthly?

a.	$174.63
b.	$480.00
c.	$538.00
d.	$608.00

• Danish Desserts just issued a 10 year 6% coupon bond. The face value of the bond is $1,000 and the bond makes annual coupon payments. If the required return on the bond is 3%, what is the bonds price?

a.	$1255.80
b.	$1000.00
c.	$778.80
d.	$1431.84