Q:1-Winburn Sports & Entertainment has an outstanding $1,000 par value bond with a 11% coupon that pays semiannually at the end of each period. The bond matures in nine years. Bonds of similar risk have a required return of 10%. What is the market value of the Winburn bond?
Mark one answer:
$1,035.54
$1,057.59
$1,058.45
$1,073.05

Q:6-The value of any asset
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is based upon the benefits provided by the asset in prior years.
is based upon the benefits that the asset will provide the owner of the asset this year.
equals the present value of future benefits accruing to the asset’s owner.
is not described by any of the above.

Q:7-The greater the uncertainty about an asset’s future benefits,
Mark one answer:
the lower the discount rate investors will apply when discounting those benefits to the present.
the higher the discount rate investors will apply when discounting those benefits to the present.
the greater is the present value of those benefits.
none of the above.

Q:8-You will be recieving $204,000.00 at the end of each year for the next 20 years. If the correct discount rate for such a stream of cash flows is 10% then what is the present value of the cash flows?
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$1,736,767.00
$4,080,000.00
$185,454.55
none of the above.

Q:9-A bond’s coupon rate
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equals its annual coupon payment divided by the bonds’ current market price.
varies during the life of the bond.
equals its annual coupon payment divided by its par value.
both a and b are correct.

Q:10-WeOweYou, Inc. has a 12 year bond outstanding that makes 9.5% annual coupon payments. If the appropriate discount rate for such a bond is 7%, what the the appropriate price for the bond?
Mark one answer:
$1,200.73
$1,000.00
$1,198.57
$754.56