ECON 5000 Midterm: ECON 5000 ECU finecon Midterm summer 2002 sol
Document Summary
Make sure to mark all of your answers on your blue bubble sheet. Note: unless indicated otherwise, assume all compounding is done annually: suppose you make a life insurance premium payment to your insurance company, which uses these funds to purchase a corporate bond. Suppose further that, at the end of one year: (i) the market price of the share of stock is ; and (ii) you receive a cash dividend payment. Then, your one-year total rate of return on holding this share of stock is: (a) 16. 19% (b) 17. 19% (c) 18. 19% (d) 19. 19% (e) 20. 19: consider again the information given in problem #7. Suppose the french citizen invests in a one-year u. s. government bond. Also suppose a year from now that the french franc / u. s. dollar exchange rate is 7. 80 french francs to the u. s. dollar. 2: suppose you put in an account earning an interest rate of 9% per year.
