Midterm2MA.pdf - FIN3000 Principles of Finance Professor Shan Midterm II Version A Student Name MULTIPLE CHOICE Choose the one alternative that best

Midterm2MA.pdf - FIN3000 Principles of Finance Professor...

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FIN3000 Principles of Finance Professor Shan Midterm II Version A Student Name________________________MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.1)The required return on a bond is equal to1)A)the real risk-free rate plus a risk premium plus an expected inflation premium.B)the risk-free rate plus a risk premium plus an expected inflation premium.C)the real rate plus a risk premium.D)the real rate of return plus the coupon rate plus an inflation rate.2)Long-term bonds are ________ than short-term bonds.2)3)What is the coupon rate of an annual bond that has a yield to maturity of 8.5%, a current price of$942.32, a par value of $1,000 and matures in thirteen years?3)4)What is the yield-to-maturity of a $1,000, 7% semi-annual coupon bond that matures in 2 yearsand currently sells for $997.07?4)

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