1. What is the par value of a corporate bond that was issued with a 9 percent annual coupon, pays $45 in semiannual interest, and is due in 15 years?

A. $1,080.00

B. $1,167.33

C. $1,070.23

D. $1,000.00

2. You purchase a machine for $12,000, depreciated straight-line to a salvage value of $2,000 over its 5 year life. If the machine is sold at the end of the third year for $7,500, what are the after tax proceeds from the sale, assuming your tax rate is 34%?

a) $6,990

b) $7,160

c) $7,210

d) $7,390

e) $7,500

3. If the U.S. sells $150 million of wheat to Brazil in return for $200 million of Brazilian oil, the $50 million difference will necessarily

A. be balanced by other transactions in the U.S. Balance of Payments account.

B. never by paid back, resulting in a $50 million loss for Brazil.

C. result in the sale of $50 million more wheat to Brazil later on.

D. obligate the U.S. to provide $50 million in foreign aid to Brazil.