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Econ 320 ch4 -

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ECON 320 Chapter 4 Review Sheets Professor C. James Hueng 1) A loan that requires the borrower to make the same payment every period until the maturity date is called a A) simple loan. B) fixed - payment loan. C) discount loan. D) a same - payment loan. E) none of the above. 2) A coupon bond pays the owner of the bond 3) If a $5,000 coupon bond has a coupon rate of 13 percent, then the coupon payment every year is 4) An $8,000 coupon bond with a $400 coupon payment every year has a coupon rate of 5) A $16,000 coupon bond with an $800 coupon payment every year has a coupon rate of A) 4 percent. B) 8 percent. C) 10 percent. D) 40 percent. E) None of the above. 6) A $10,000 coupon bond with an $800 coupon payment every year has a coupon rate of 7) With an interest rate of 5 percent, the present value of $100 next year is approximately 8) With an interest rate of 10 percent, the present value of a security that pays $1,100 next year and $1,464.10 four years from now is: 9) If a security pays $110 next year and $121 the year after that what is its yield to maturity if it sells for $200? A) 9 percent B) 10 percent C) 11 percent D) 12 percent 10) Which of the following $1,000 face - value securities has the highest yield to maturity?
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11) Which of the following $1,000 face - value securities has the lowest yield to maturity? 12) Which of the following $1,000 face - value securities has the highest yield to maturity?
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