1.
What are coupon payments, and what is a coupon rate?
2.
Define the following terms: bond indenture, par value, principal, maturity,
call provision, and
sinking fund.
3. What
does the term payout ratiomean?
4. A
corporate bond is quoted at a price of 102. What is its dollar price?
5.
What is interest-rate risk? How is interest-rate risk related to the maturity
of a bond and to
the coupon
rate for a bond?
6.
(Required return) According to the CAPM, what would be the required return on
an asset
that
has a beta of 1.35 when the expected return on the market portfolio is 12% and
the
riskless
return is 7%?
ISBN:
0-536-42875
7.
(Required return) According to the CAPM, what would be the required return on
an asset
that
has a beta of 1.25 when the expected return on the market portfolio is 12% and
the
riskless
return is 5%?
8.
(CAPM) The required return on an asset with a beta of 1.4 is 17% and the
riskless return
is 7%.
What is the expected return on the market portfolio?
9.
(CAPM) Stock A has a beta of 2.0 and a required return of 15%. The market
return is
10%. What
will be the required return on stock B, which has a beta of 1.4?
