1. Level 3 has a CCC-rated corporate bond outstanding. There are 6 years remaining to maturity. The bond has a 9.125% coupon and closed at the price of $450. Find the bond's yield to maturity.
2. In perfect capital? markets, buying and selling securities is a zerominusNPV ?transaction, so retaining cash versus paying it out does not affect firm value. True False
3. Firms may retain large amounts of cash to cover future potential needs that allows a firm to avoid? ________.
A. transaction costs and financial distress costs
B. clientele effects
C. tax payments
D. none of the above