1. If you knew a bond would pay you $50 every year for 10 years and, at the end of the 10 years, you’d also receive a $1,000 payment, how much should you pay to purchase the bond? Assume similar bonds yield 8 percent, and select the value closest to the correct answer.
A. Not more than $336
B. Not more than $463
C. Not more than $733
D. Not more than $799
2. If you believe a stock’s market value is about to drop, you could profit in the decline by _______ the stock.
A. assuming a long position in
B. assuming a bearish outlook on
C. assuming a short position in
D. placing a market order in