On January 1, 2000, the Liz-Beth Company issued zero-coupon bonds for $68,301, which resulted in an effective interest rate of 10 percent. The bonds' face value was $100,000, and the maturity date was
January 2004. What would be the amount of interest that is paid in 2000?

• A.$--0-
• B.$6,830
• C.$10,000

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Jackie Gold owned a bond that had a Modified duration of 19.400. If the bond had a coupon of
19.00 %, and a yield to maturity of 8.50 %, then what is the change in bond price given a change in yield of - 290 basis points?

• A.33.756%
• B.-14.741%
• C.56.260%

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The total return for utilities stock mutual funds have a mean of 10.5% and a sample relative skewness of Sk = -2.5 . Based on this information which of the following statements is true?

• A.The median of the distribution is less than or equal to 10.5%.
• B.The median of the distribution greater than 10.5%.
• C.The distribution is mesokurtic.

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Which of the following is the best explanation for diseconomies of scale?

• A.coordination problems
• B.indivisibilities
• C.diminishing returns

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Which bond has the longest duration?

• A.15-year maturity, 6% coupon
• B.8-year maturity, 6% coupon
• C.15-year maturity, 11% coupon

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