Time Value of $
Bonds
Stocks
More Time Value & Bonds
100
What is the process of finding the future value of a cash flow or a series of cash flows?
Compounding
100
What is the 'Par Value' of the corporate bonds we have been working with?
$1,000
100
You can make money 2 ways from stock - Dividend Yield and ____.
Capital Gains
100
This process is the opposite of COMPOUNDING.
Discounting.
200
True or False - Annuities have constant payment(s) and a fixed number of periods.
True.
200
A bond that pays a Coupon Rate of 7% pays what amount of interest each year?
$70
200
If you purchase a share of stock at time Period '3', which dividend is the first one you are entitled to?
Period '4'
200
Which bond is more likely to yield you a higher rate of return? One that is rated 'A' by Moody's or one that is rated 'D' by Moody's?
The one rated 'D' by Moody's.
300
What is a stream of equal payments at fixed intervals continuing forever?
A Perpetuity
300
When Interest Rates in the market DECREASE, the price of bonds tend to ____.
increase
300
If the most recent Dividend was $1.00 and g = 5%, what is D2 (D sub 2)? (Go out 4 digits)
$1.1025
300
When a bond is selling at a DISCOUNT, it is selling for _____.
Less than $1,000
400
An Annuity whose payment occurs at the END of each period is what kind of Annuity?
Ordinary
400
If Interest on a bond is paid out semi-annually, how often is this?
Twice a year.
400
In Gordon's Model, 'g' represents growth in Dividends as well as____.
Stock Price
400
True or False - A bond's coupon payment is generally greater than the bond's par value.
False
500
Using the Rule of 72, if you want your money to double in 10 years what rate must you earn each year?
7.2%
500
If the annual interest payment on a bond is $120, what is the Coupon Rate?
12%
500
The P/E ratio dividends _____ by ______.
Price Per Share by Earnings Per Share
500
Treasury Securities are issued by whom?
US Government
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