Chapter 14 test - A bond is simply a form of an interest...

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A bond is simply a form of an interest bearing note. a. True b. False Issuing bonds to finance a company's operations generally has a greater impact on earnings per share than issuing common stock. a. True b. False A bond is usually divided into a number of individual bonds of $500 each. a. True b. False The market rate of interest is affected by a variety of factors, including investors' assessment of current economic conditions. a. True b. False The buyer determines how much to pay for the bonds by computing the present value of these future cash receipts using the contract rate of  interest. a. True b. False The present value of $5,000 to be received in 4 years at a market rate of interest of 6% compounded annually is $3,636.30. a. True b. False A corporation would  not  be successfully trading on equity if it gathered funds by a. issuing notes 
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This note was uploaded on 06/28/2011 for the course BUSA 1101 taught by Professor Kostov during the Spring '11 term at Georgia Southwestern.

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Chapter 14 test - A bond is simply a form of an interest...

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