1. The rate of return earned on a U.S. Treasury bill is frequently used as a proxy for the:
A. risk premium.
B. deflated rate of return.
C. risk-free rate
D. expected rate of return.
E. market rate of return.
2. You borrow $24,000 to buy a car. The loan is to be paid off in quarterly installments over four years at 10 percent interest annually. The first payment is due one quarter from today. What is the amount of each quarterly payment?
a) $1,745
b) $1,794
c) $1,838
d) $1,876