Question

make that sells for par value. What is the maturity on th A. The bond must mature in 1 year B. The band could have any maturity date. C. The bond must mature in 5 years. D. The bond must mature in 10 years. E. None of these are correct. 7. You want to buy a new sports coupe for $84,600, and the finance office at the dealership has quoted you a 7.1 APR loan for 48 months to buy the car. What will your monthly payments be? What is the effective annual rate on A. $2,018.01; 7.24 percent B. $2,018.01; 7.23 percent C. $2,018.01; 7.34 percent D. $2,029.78; 7.23 percent E. $2,029.78; 7.34 percent 8. Semistrong form market efficiency states that current prices reflect: A. random information with no clear distinction as to the source of that information. B. stock's price history and trading volume only. C. stock's price history and trading volume, as well as all available public information. D. stock's price history and trading volume, all available public information, and even all private information E. none of the above. 9. The rate of return on which one of the following is used as the risk-free rate? A. Medium-term corporate bonds B. Long-term corporate bonds C. Inflation, as measured by the Consumer Price Index D. U.S. Treasury bill E. Large-company stocks 10. The Treasury yield curve plots the yields on Treasury notes and bonds relative to the_of those securities. A. face value B. market price C. maturity D. coupon rate E. issue date 11. What is the market called that allows shareholders to resell their shares to other investors? A. Primary B Proxy C. Secondary D. Inside E. Initial 12. Brickhouse is expected to pay annual dividends of $1.90 and $2.10 over the next two years, respectively. An company expects to pay a constant dividend of $2.30 a share forever. What is the value of this stock today at a return of 16 percent? A. $12.44 B. $13.30 C. $13.88 D. $14.08

Answer 1

ans 8) Semistrong market is don't tell about the private information thus the correct answer is option C.

Ans 9) U. S Treasury bill's rate of return used as a risk free rate. Correct option is option D

Ans 10) Yield curve is relation between yield to maturity to the maturity of those security. Correct option is C

Ans 11) Secondary is correct answer.

Ans 12) Correct answer is $13.88.

It can be find using the stock price valuation formula for dividend discount model.