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Author Question: The less risky the bond (or the higher the bond rating) the lower will be the yield to maturity on ... (Read 80 times)

mwit1967

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  • Posts: 501
on: Jul 10, 2018
The less risky the bond (or the higher the bond rating) the lower will be the yield to maturity on the
  bond.
 
  Indicate whether the statement is true or false

Question 2

GPS Inc wishes to estimate its cost of retained earnings. The firm's beta is 1.3. The rate on 6-month
  T-bills is 2, and the return on the S&P 500 index is 15.
 
  What is the appropriate cost for retained
  earnings in determining the firm's cost of capital?
  A) 17.0 B) 19.5 C) 22.1 D) 18.9
Foundations of Finance ¦ Keown, Petty, Martin ¦ 9th Edition
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debra928

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Reply #1 on: Jul 10, 2018
Answer to Question 1

TRUE

Answer to Question 2

D


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