How Much Would You Expect to Pay for a $10,000

question 52

Multiple Choice

How much would you expect to pay for a $10,000 Treasury note quoted at 96:27?

• A) $9,627.00
• B) $10,000.00
• C) $968.44
• D) $9,684.38
• E) None of the above

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Definitions:

Residual Dividend Policy

A strategy where dividends paid to shareholders are based on earnings left after all operational and expansion financing needs are met.

Target Capital Structure

The mix of debt, preferred stock, and common equity that a company aims to hold to minimize its cost of capital.

Projected Capital Budget

A forward-looking budget that outlines anticipated investments in projects and assets for the purpose of long-term growth.

Net Income

The net income of a business following the deduction of all costs and taxes from its overall revenue.