Evaluate the Expression $\left( 1 - \frac { 1 } { 4 } \right) ^ { 2 } + \left( 1 + \frac { 1 } { 4 } \right) ^ { 2 }$

question 14

Multiple Choice

Evaluate the expression. $\left( 1 - \frac { 1 } { 4 } \right) ^ { 2 } + \left( 1 + \frac { 1 } { 4 } \right) ^ { 2 }$

• A) \(2 \frac { 1 } { 8 }\)
• B) \(\frac { 1 } { 16 }\)
• C) \(3 \frac { 1 } { 8 }\)
• D) \(1 \frac { 1 } { 8 }\)
• E) \(1 \frac { 1 } { 16 }\)

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Definitions:

Par Value

The face value of a bond or stock as stated on the certificate or instrument, which differs from its market value.

WACC Calculation

The process of calculating the Weighted Average Cost of Capital, which measures a firm's cost of capital from all sources, weighted according to the proportion of each capital component.

Annual Coupons

The interest payments made to bondholders annually over the life of the bond.

Capital Structure

The composition of a company's liabilities and equity, outlining how a business finances its overall operations and growth.