Problem 2

Choose the FALSE statement: 

Generally, a corporation is owned by its shareholders.

A corporation, potentially, has infinite life because it not a real

person.

C. A patent is an intangible asset. D. A building is a tangible asset. E. Corporations can sue and be sued. 

7/ Suppose you have the option of two bonds, both with the same price. Duration of bond A is much longer than duration of Bond B. Suppose that you know that tomorrow the interest rate will increase but the market still is not aware of that. What will be your best decision?

A. It is not possible to determine. B. Sell all your bonds. C. Invest in Bond A. D. Invest in Bond B. 

E. None of the above options.