Jane has just purchased an apartment for $250,000. Her down payment is $70,000 and the remaining amount of the purchase will be financed using a 20 year mortgage. The bank as quoted her a rate of 5.6% with semi-annual compounding and monthly payments. How much will her monthly payments be?

	$1,725
	$1,448
	$1,242
	$987

A cash-strapped young professional offers to buy your car with four, equal annual payments of $3,000, beginning two years from today. Assuming you're indifferent to cash versus credit, that you can invest at 10%, and that you want to receive $9,000 for the car, should you accept?

	Yes; present value is $9,510.
	Yes; present value is $11,372.
	No; present value is $8,645.
	No; present value is $7,461.

What happens when a bond's expected cash flows are discounted at a rate lower than the bond's coupon rate?

	The price of the bond increases.
	The coupon rate of the bond increases.
	The par value of the bond decreases.
	The coupon payments will be adjusted to the new discount rate.

What is the rate of return for an investor who pays $1,054.47 for a three-year bond with a 7% coupon and sells the bond one year later for $1,037.19? Assume annual coupon.

	5.00%
	5.33%
	6.46%
	7.00%

What would be the expected price of a stock when dividends are expected to grow at a 25% rate for three years, then grow at a constant rate of 5%, if the stock's required return is 13% and next year's dividend will be $4.00?

	68.63
	74.41
	79.47
	62.10