1 what does a call provision call feature allow bond


1. What does a call provision [call feature] allow [bond] issuers to do, and why would they do it"?

2. "Provide the definitions of a discount bond and premium bond. Give examples?

3. "Describe the differences in interest payments and bond prices between a 5 percent coupon bond and a zero coupon bond"?

4. "Calculate the price of a zero coupon bond that matures in 20 years if the market interest rate is 6.5 percent"?

5. "Compute the price of a 4.5 percent coupon bond with 15 years left to maturity and a market interest rate of 6.8 percent"?

6. "A 6.85 percent coupon bond with 26 years left to maturity is offered for sale at $1,035.25. What yield to maturity [interest rate] is the bond offering"?

7. "As owners, what rights and advantages do shareholders obtain"?

8. "Why might the Standard and Poor's 500 Index be a better measure of stock market performance than the Dow Jones Industrial Average?

9. "What are the differences between common stock and preferred stock"?

10. "On March 14, 2013, the Dow Jones Industrial Average set a new high. The index closed at 14,539.14, which was up 83.86 points from the previous day's close of 14.455.28. What was the return (in percent to four decimal places) of the stock market for March 14, 2013?

11. "At your brokerage firm, it costs $9.50 per stock trade. How much money do you need to buy 300 shares of Time Warner, Inc. (TWX), which trades at $22.62"?

12. "Financial analysts forecast Safeco Corporation (SAF) growth for the future to be a constant 10 percent. Safeco's recent dividend was $1.20. What is the value of Safeco stock when the required return is 12 percent"?

13. "A preferred stock from Duquesne Light Company (DQUPRA) pays $2.10 in annual dividends. If the required return on the preferred stock is 5.4 percent, what is the value of the stock"?

14. "Ultra Petroleum (UPL) has earnings per share of $1.56 and a P/E ratio of 32.48. What is the stock price"?

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Accounting Basics: 1 what does a call provision call feature allow bond
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