1. Consider the one-period growth model. Assume the next period’s dividend is $1, that stockholders require a 12% return, that new investment is expected to yield 14%, and that the retention rate is 50%. What is the implied fair price?
2. Which of the following procedures for bidding for Australian Treasury bonds is NOT correct?
1) Bids must be submitted electronically by registered bidders.
2) The minimum bid must be for a face value of $1 million and multiples thereafter.
3) Bids are made in terms of prices up to three decimal places.
4) Bids are accepted in ascending order.
3. Which maturity date is NOT likely for a bank bill?
1) 30 days
2) 90 days
3) 180 days
4) 360 days