Solution to MidtermExam1

Solution to MidtermExam1 - Name: _ Exam ID: 123424 Solution...

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Name: _________________________________ Exam ID: 123424 Solution to Midterm Exam I Answers are highlighted in YELLOW Introduction to Finance, BUSFIN 1030, Summer 2010, Evening Section 22 nd June, 2010 This Exam has 40 Questions (Numbered 1 through 40) It is your job to: “ Identify the choice that best completes the statement or answers the question. All you be allowed to keep with you during this exam is a pencil, eraser and a calculator. No books, notes, cell phones, electronic devices or paper of any kind will be allowed. A list of formulas that you may find useful is appended at the end of this exam. You may use blank space on this exam to do any rough work, if you need to. Ask the instructor for blank pages if you need more paper. You must write your name on all paper that you take and return it with your exam and answer sheet. Please verify the number of questions before you start. If you have any questions during the course of the Exam, ask the instructor and clarify. Other useful instructions: Each question carries equal weight. Answer the questions to the best of your ability. As with all exams, if at first you cannot understand the question, read it again. If a particular question seems too difficult, don’t spend inordinate amount of time on it. Make sure you answer all the questions on the exam. You will get -zero- credit for missing answers. If you have to, guess judiciously. Wrong answers will also get -zero- credit. Make sure you mark your answers in the appropriate space provided on the scantron sheet. Answering a question on the paper exam but not on the scantron will not fetch you any credit for the particular question. BUSFIN 1030 Summer 2010 – Midterm Exam Page 1
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Name: _________________________________ Exam ID: 123424 Make absolutely sure that you mark and write your name and the Exam ID (found on the top right portion of this exam) in the appropriate space provided on the scantron sheet. All parts of the actual exam should be returned to the instructor at the end of the exam. Best of Luck!!! ____ 1. You are offered a zero-coupon bond with a $1,000 face value and 5 years left to maturity. If the required return on the bond is 8%, what is the most you should pay for this bond? a. $752.69 b. $680.58 c. $1,000 d. $1,126.94 2 ____ 2. The ultimate owner(s) of an ongoing corporation are a. the federal government. b. the debt holders. c. the equity holders. d. the executive staff of the corporation. ____ 3. Which of the following is a weakness of a sole proprietorship? a. Unlimited life b. Easy to form c. Limited liability d. Limited access to capital ____ 4. What do you call the portion of your total return on a stock investment that is caused by an increase in the value of the stock. a.
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This note was uploaded on 02/28/2011 for the course BUSFIN 1030 taught by Professor Zutter during the Spring '08 term at Pittsburgh.

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Solution to MidtermExam1 - Name: _ Exam ID: 123424 Solution...

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