Question 1Which of the following statements is most correct? a. Sinking fund provisions do not require companies to retire their debt; they only establish “targets” for the company to reduce its debt over time. b. Sinking fund provisions sometimes work to the detriment of bondholders–particularly if interest rates have declined over time. c. If interest rates have increased since the time a company issues bonds with a sinking fund provision, the company is more likely to retire the bonds by buying them back in the open market, as opposed to calling them in at the sinking fund call price. d. Statements a and b are correct. e. Statements b and c are correct.Question 2Which of the following statements is most correct? a. If a bond’s yield to maturity exceeds its annual coupon, then the bond will be trading at a premium. b. If interest rates increase, the relative price change of a 10year coupon bond will be greater than the relative price change of a 10year zero coupon bond. c. If a coupon bond is selling at par, its current yield equals its yield to maturity. d. Both a and c are correct. e. None of the answers above is correct. Question 3Which of the following statements is most correct? a. All else equal, a bond that has a coupon rate of 10 percent will sell at a discount if the required return for a bond of similar risk is 8 percent. b. The price of a discount bond will increase over time, assuming that the bond’s yield to maturity remains constant over time. c. The total return on a bond for a given year consists only of the coupon interest payments received. d. Both b and c are correct. e. All of the statements above are correct.Question 4Which of the following Treasury bonds will have the largest amount of interest rate risk (price risk)? a. A 7 percent coupon bond, which matures in 12 years. b. A 9 percent coupon bond, which matures in 10 years. c. A 12 percent coupon bond, which matures in 7 years. d. A 7 percent coupon bond, which matures in 9 years. e. A 10 percent coupon bond, which matures in 10 years.Question 5Which of the following statements is most correct? a. All else equal, an increase in interest rates will have a greater effect on the prices of longterm bonds than it will on the prices of shortterm bonds. b. All else equal, an increase in interest rates will have a greater effect on highercoupon bonds than it will have on lowercoupon bonds. c. An increase in interest rates will have a greater effect on a zero coupon bond with 10 years maturity than it will have on a 9year bond with a 10 percent annual coupon. d. All of the statements above are correct. e. Answers a and c are correct.Question 6A bond has an annual 8 percent coupon rate, a maturity of 10 years, a face value of $1,000, and makes semiannual payments. If the price is $934.96, what is the annual nominal yield to maturity on the bond? a. 8% b. 9% c. 11% d. 10% e. 12%Question 7Assume that you wish to purchase a bond with a 30year maturity, an annual coupon rate of 10 percent, a face value of $1,000, and semiannual interest payments. If you require a 9 percent nominal yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond? a. $1,103.19 b. $1,102.74 c. $905.35 d. $1,106.76 e. $1,149.63Question 8Due to a number of lawsuits related to toxic wastes, a major chemical manufacturer has recently experienced a market reevaluation. The firm has a bond issue outstanding with 15 years to maturity and a coupon rate of 8 percent, with interest paid semiannually. The required nominal rate on this debt has now risen to 16 percent. What is the current value of this bond? a. $550 b. $1,000 c. $7,783 d. $ 450 e. $1,273Question 9In order to accurately assess the capital structure of a firm, it is necessary to convert its balance sheet figures to a market value basis. KJM Corporation’s balance sheet, as of today, is as follows:Longterm debt (bonds, at par) $10,000,000Preferred stock 2,000,000Common stock ($10 par) 10,000,000Retained earnings 4,000,000Total debt and equity $26,000,000The bonds have a 4 percent coupon rate, payable semiannually, and a par value of $1,000. They mature exactly 10 years from today. The yield to maturity is 12 percent, so the bonds now sell below par. What is the current market value of the firm’s debt? a. $5,480,000 b. $5,412,000 c. $2,531,000 d. $7,706,000 e. $7,056,000Question 10The current price of a 10year, $1,000 par value bond is $1,158.91. Interest on this bond is paid every six months, and the nominal annual yield is 14 percent. Given these facts, what is the annual coupon rate on this bond? a. 14% b. 17% c. 10% d. 12% e. 21%Question 11A bond matures in 12 years, and pays an 8 percent annual coupon. The bond has a face value of $1,000, and currently sells for $985. What is the bond’s current yield and yield to maturity? a. Current yield = 8.20%; yield to maturity = 8.37%. b. Current yield = 8.12%; yield to maturity = 8.37%. c. Current yield = 8.00%; yield to maturity = 7.92%. d. Current yield = 8.12%; yield to maturity = 8.20%. e. Current yield = 8.12%; yield to maturity = 7.92%.Question 12Palmer Products has outstanding bonds with an annual 8 percent coupon. The bonds have a par value of $1,000 and a price of $865. The bonds will mature in 11 years. What is the yield to maturity on the bonds? a. 9.25% b. 8.00% c. 9.89% d. 10.09% e. 11.13%Question 13A corporate bond matures in 14 years. The bond has an 8 percent semiannual coupon and a par value of $1,000. The bond is callable in five years at a call price of $1,050. The price of the bond today is $1,075. What are the bond’s yield to maturity and yield to call? a. YTM = 6.64%; YTC = 4.78% b. YTM = 14.29%; YTC = 14.09% c. YTM = 7.14%; YTC = 7.34% d. YTM = 7.14%; YTC = 7.05% e. YTM = 3.57%; YTC = 3.52%Question 14You have just been offered a $1,000 par value bond for $847.88. The coupon rate is 8 percent, payable annually, and annual interest rates on new issues of the same degree of risk are 10 percent. You want to know how many more interest payments you will receive, but the party selling the bond cannot remember. Can you determine how many interest payments remain? a. 10 b. 15 c. 14 d. 20 e. 12Question 15A corporate bond which matures in 12 years, pays a 9 percent annual coupon, has a face value of $1,000, and a yield to maturity of 7.5 percent. The bond can first be called four years from now. The call price is $1,050. What is the bond’s yield to call? a. 7.50% b. 6.73% c. 7.10% d. 13.45% e. 11.86%Question 16Meade Corporation bonds mature in 6 years and have a yield to maturity of 8.5 percent. The par value of the bonds is $1,000. The bonds have a 10 percent coupon rate and pay interest on a semiannual basis. What are the current yield and capital gains yield on the bonds for this year? (Assume that interest rates do not change over the course of the year). a. Current yield = 8.50%, capital gains yield = 1.50% b. Current yield = 9.35%, capital gains yield = 0.65% c. Current yield = 9.35%, capital gains yield = 0.85% d. Current yield = 10.00%, capital gains yield = 0.00% e. None of the answers above is correct.
Our Service Charter

Excellent Quality / 100% PlagiarismFree
We employ a number of measures to ensure top quality essays. The papers go through a system of quality control prior to delivery. We run plagiarism checks on each paper to ensure that they will be 100% plagiarismfree. So, only clean copies hit customers’ emails. We also never resell the papers completed by our writers. So, once it is checked using a plagiarism checker, the paper will be unique. Speaking of the academic writing standards, we will stick to the assignment brief given by the customer and assign the perfect writer. By saying “the perfect writer” we mean the one having an academic degree in the customer’s study field and positive feedback from other customers. 
Free Revisions
We keep the quality bar of all papers high. But in case you need some extra brilliance to the paper, here’s what to do. First of all, you can choose a top writer. It means that we will assign an expert with a degree in your subject. And secondly, you can rely on our editing services. Our editors will revise your papers, checking whether or not they comply with high standards of academic writing. In addition, editing entails adjusting content if it’s off the topic, adding more sources, refining the language style, and making sure the referencing style is followed. 
Confidentiality / 100% No Disclosure
We make sure that clients’ personal data remains confidential and is not exploited for any purposes beyond those related to our services. We only ask you to provide us with the information that is required to produce the paper according to your writing needs. Please note that the payment info is protected as well. Feel free to refer to the support team for more information about our payment methods. The fact that you used our service is kept secret due to the advanced security standards. So, you can be sure that no one will find out that you got a paper from our writing service. 
Money Back Guarantee
If the writer doesn’t address all the questions on your assignment brief or the delivered paper appears to be off the topic, you can ask for a refund. Or, if it is applicable, you can opt in for free revision within 1430 days, depending on your paper’s length. The revision or refund request should be sent within 14 days after delivery. The customer gets 100% moneyback in case they haven't downloaded the paper. All approved refunds will be returned to the customer’s credit card or Bonus Balance in a form of store credit. Take a note that we will send an extra compensation if the customers goes with a store credit. 
24/7 Customer Support
We have a support team working 24/7 ready to give your issue concerning the order their immediate attention. If you have any questions about the ordering process, communication with the writer, payment options, feel free to join live chat. Be sure to get a fast response. They can also give you the exact price quote, taking into account the timing, desired academic level of the paper, and the number of pages.