Assets are traded in the capital markets

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1. What is the payback period for a project with an initial investment of $180,000 that provides an annual cash inflow of $40,000 for the first three years and $25,000 per year for years four and five, and $50,000 per year for years six through eight?

2. Which of the following assets are traded in the capital markets?

a. Stock and bonds

b. Stocks and options

c. Options and futures

d. Bonds and futures

3. You are going to invest in corporate bond and considering two AAA bonds, sold in the US. Market with a 10-year maturity: one issued by a U.S firm, the other issued by a German firm. The two bonds are similar in all of the following aspect EXCEPT

a.Risk-free rate of return

b. Maturity risk

c. Liquidy risk

d. Default risk

4. The major areas of the finance discpline includes all of the following EXCEPT

a. Financial market and institutions

b. Investments

c. Managerial finance

d. Monetary theory

Reference no: EM131558698

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