1. What is the value of a bond with a 1,000 face value, an annual coupon rate of 4%, and a maturity of 20 years. The required rate of return is 6%. Coupon interest payments are made annually.
2. A stock's dividend yield is obtained by computing the company's
3. What must happen for a bond investor to actually earn the yield-to-maturity value computed when the bond is purchased by that investor
4. With respect to a company's balance sheet, what is the definition of 'book value?
5. What is the annualized yield-to maturity of a bond with a 1,000 face value, an annual coupon rate of 6%, and a maturity of 40 years. The current market price of the bond is 760.85. Coupon interest payments are made semi-annually.
6. When applying the general valuation model to a business, what should be the focus?
7. Suppose a company sells a new 1,000 face value bond to investors in the primary market. The annual coupon rate is 5%. The yield to maturity is 5%. Coupon interest payments are made annually. What is the price investors are paying for this new bond?
8. The annual yield on preferred stock (PS) is equal to what?
9. The liquidation value of a firm is defined as what?
10. What happens If the market price of a bond increases?
11. What is the market price of a zero-coupon bond with a $1,000 face value, a yield to maturity of 6%, and a maturity of 15 years.
12. What does discounted cash flow model focuses on, when used to value a company's common stock?