1. A firm's Equity Multiplier will definitely increase if they : 1. issue both new long-term bonds and new common stock simultaneously; 2. issue new long-term bonds only; 3. issue new common stock only; 4. increase their debt ratio
a. 1 only
b. 2 only
c. 3 only
d. 4 only
e. both answrs (1) and (4) are correct
f. both answers (2) and (4) are correct
2. Given a 3.5%, compute the total present value of payments made in years 1, 2, 3, and 4 of $1,000, $1,200, $1,200 and $1,500.
$4,900
$4,329.71
$4,475.88
$4,591.37