1. Which statement is false?
A. Most bonds trade over the counter in private markets.
B. The Oil Producing and Exporting Countries (OPEC) are one of the two largest holders of U.S. Treasury debt.
C. If two bonds are otherwise identical, but one is callable and the other is putable, the putable bond is less risky to the lender (investor) than the callable bond.
D. A zero-coupon bond originates (is issued) at a discount to par.
2. ABC Co. is analyzing a proposed project with anticipated sales of 12,000 units, give or take 4 percent. The expected variable cost per unit is $7 and the expected fixed cost is $36,000. The cost estimates have a range of plus or minus 6 percent. The depreciation expense is $29,600. The tax rate is 34 percent. The sale price is estimated at $14.99 a unit, give or take 1 percent. What is the operating cash flow under the best-case scenario?
A. $58,499.29
B. $58,235.78
C. $59,311.10
D. $56,208.01