1. What is the duration of a bond with four years to maturity and a coupon of 8.6 percent paid annually if the bond sells at par?

2. An individual with a high tolerance for risk and volatility in financial markets would be most comfortable with more than 50% of his investments in which of the following?

Government bond

Money market account

Insured bank savings account

Common stocks.

Mutual Funds

3. Mellott Corp. has an equity value of $13,680. Long-term debt is $9,150. Net working capital, other than cash, is $3,710. Fixed assets are $18,330 and current liabilities are $2,010. How much cash does the company have?

4. You are to receive an annuity in the amount of $50,000 per year for twelve (12) years. The inflation rte is 5% and the market rate is 9%. What is the annuity worth in terms of a single equivalent worth in todays dollars?