BUS 401 Week 2 Quiz (New)

1. Which of the following is NOT true of preferred stock?

2. The payment structure of a corporate bond is best thought of as:

3. The Rule of 72 says:

4. Zeta Corporation just paid a $2.00 dividend. Analysts believe that Zeta Corporation’s dividend will grow by 20% next year, and then settle into a constant growth regime at 5% per year into the future. If investors assign a required rate of return of 12% to Zeta’s stock, what should the stock sell for today?

5. Interest rates are given as annual rates. If semiannual (twice a year) compounding is being used, then you would make the following adjustments:

6. The longer we have to wait for a future amount to be received:

7. In an amortized loan:

8. Which of the following statements is NOT true about future values?

9. The cash flows for a perpetuity continue into the future indefinitely. An example of a perpetuity is:

10. Compounding means that: