Business Smarts - Sample Module for Corporate Financial Management

1) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 8%, what is the bond's market value?

 a)  $2,000.

 b)  $1,000.

 c)  $1,400.

 d)  $850.

 e)  None of the above.

2) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 9%, what is the bond's market value?

 a)  $928.

 b)  $924.

 c)  $1,000.

 d)  $1,072.

 e)  None of the above.

3) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $914.

 b)  $864.

 c)  $1,136.

 d)  $928.

 e)  None of the above.

4) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 7%, what is the bond's market value?

 a)  $1,000.

 b)  $1,062.

 c)  $921.

 d)  $1,079.

 e)  None of the above.

5) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,186.

 b)  $1,068.

 c)  $1,168.

 d)  $1,079.

 e)  None of the above.

6) A bond with a coupon rate of 8%, paid quarterly, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 8%, what is the bond's market value?

 a)  $965.

 b)  $1,106.

 c)  $1,050.

 d)  $1,000.

 e)  None of the above.

7) A bond with a coupon rate of 8%, paid quarterly, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 9%, what is the bond's market value?

 a)  $983.

 b)  $887.

 c)  $927.

 d)  $1,073.

 e)  None of the above.

8) A bond with a coupon rate of 8%, paid quarterly, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $861.

 b)  $877.

 c)  $816.

 d)  $961.

 e)  None of the above.

9) A bond with a coupon rate of 8%, paid quarterly, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 7%, what is the bond's market value?

 a)  $981.

 b)  $1,081.

 c)  $1,011.

 d)  $1,008.

 e)  None of the above.

10) A bond with a coupon rate of 8%, paid quarterly, and a face value of $1,000 matures in 12 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,107.

 b)  $1,170.

 c)  $1,070.

 d)  $1,710.

 e)  None of the above.

11) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 15 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $948.

 b)  $608.

 c)  $884.

 d)  $848.

 e)  None of the above.

12) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 18 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $656.

 b)  $936.

 c)  $836.

 d)  $863.

 e)  None of the above.

13) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 21 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $827.

 b)  $872.

 c)  $927.

 d)  $854.

 e)  None of the above.

14) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 9 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $865.

 b)  $885.

 c)  $985.

 d)  $893.

 e)  None of the above.

15) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 6 years. If the current annual market interest rate is 10%, what is the bond's market value?

 a)  $913.

 b)  $933.

 c)  $931.

 d)  $813.

 e)  None of the above.

16) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 15 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,094.

 b)  $1,149.

 c)  $1,194.

 d)  $1,294.

 e)  None of the above.

17) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 18 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,117.

 b)  $1,217.

 c)  $1,277.

 d)  $1,271.

 e)  None of the above.

18) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 21 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,135.

 b)  $1,253.

 c)  $1,325.

 d)  $1,235.

 e)  None of the above.

19) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 9 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,186.

 b)  $1,163.

 c)  $1,136.

 d)  $1,036.

 e)  None of the above.

20) A bond with a coupon rate of 8%, paid annually, and a face value of $1,000 matures in 6 years. If the current annual market interest rate is 6%, what is the bond's market value?

 a)  $1,098.

 b)  $1,089.

 c)  $998.

 d)  $1,198.

 e)  None of the above.



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