3100-PracticeExam2

3100-PracticeExam2 - NAME FIN 3100 Practice Exam 2 Dr Lucy...

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FIN 3100 Practice Exam 2 Dr. Lucy Ackert You may use a calculator and formula sheet. You must turn your formula sheet in with your exam. No other materials are permitted. Part 1: Multiple Choice (4 points each). Please circle only one answer or all will be counted incorrect. 1. The written agreement between the corporation and its creditors is called the bond a. structure b. indenture. c. debenture. d. security. e. face. 2. A \$1,000 face value bond is currently traded at 1,133.50. The bond pays semi-annual payments of \$44.50 and matures in 11 years. What is the coupon rate? a. 3.23 percent b. 8.90 percent c. 22.25 percent d. 4.45 percent e. 32.25 percent 3. Stock X has a beta of 0.82 and standard deviation of returns of 24%. Stock Y has a beta of 0.92 and a standard deviation of returns of 26%. Which stock has more total risk? a. Stock X b. Stock Y c. There is not enough information to determine which has more risk. d. They have the same risk. 4. A preferred stock pays a quarterly dividend of \$2.50 every 3 months. If the required return per year is 10%, what is the price of this stock today? a.

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This note was uploaded on 11/17/2011 for the course FIN 3100 taught by Professor Gillette during the Fall '08 term at Kennesaw.

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3100-PracticeExam2 - NAME FIN 3100 Practice Exam 2 Dr Lucy...

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