You are expecting to receive the $10,000 par value back on a bond in 2 years. Interest rates have risen quickly due to the fear of inflation. You decide to sell the bond today. Which statement is TRUE?

1. The bond value will be worth more than $10,000 today
2. The bond value will be worth less than $10,000 today
3. The bond value will be worth $10,000 today
4. The bond value cannot be determined with this information

Which of the following investment will have the largest present value? No math is necessary unless you want to check your answer.

1. 6% interest for 5 years
2. 8% interest for 5 years
3. 6% interest for 10 years
4. 8% interest for 10 years

Only 1 of these statements about the Cash Conversion Cycle is TRUE. Which one is it? Correct answer 1 point and explanation as to why it is correct is 1 point.

1. A negative cash conversion cycle is a sign of trouble
2. All else equal, a decline in DIO means inventory levels have risen
3. All else equal, companies prefer a higher DPO number to a lower DPO number
4. DSO tells us the percent of receivables that are past due

Which of these actions will most likely increase the ROE of a company?

1. 1. Increasing expenses without changing unit sales
   2. Increasing prices without reducing unit sales
   3. Lowering the amount of debt of the company
   4. Paying suppliers quicker

Thinking about the rules of future value. There are at least 3 things someone can do to increase the future value of an investment. List three of them and explain why they increase the future value. 2 points