Sale or purchase of any security at the market price

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Reference no: EM131998163

1. If the capital markets are efficient, then the sale or purchase of any security at the market price is:

a. sometimes a zero NPV transaction.

b. a negative NPV transaction.

c. a positive NPV transaction.

d. None of the answers are correct.

2. Mike Carlson will receive $32,000 a year from the end of the third year to the end of the 14th year (12 payments). The discount rate is 12%. The present value today of this deferred annuity is: Use Appendix B and Appendix D. (Round "PV Factor" to 3 decimal places.)

$139,248 $152,442 $169,893 $157,972

Reference no: EM131998163

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