Chapter 10 and 13 quiz

a security that obligates the issuer to make specified payments to the holder over a period of time.

the payment to the bondholder at the maturity of the bond.

a bond's annual interest payment per dollar of par value.

bonds are typically issued with these up to 30 years.

however, there can these can range from 50-100 years.

bonds that may be repurchased by the issuer at a specified call price during the call period.

a bond with an option allowing the bondholder to exchange the bond for a specified number of shares of common stock in the firm.

the discount rate that makes the present value of a bond's payment equal to its price.

annual coupon divided by bond price.

bonds seeling above par value

bonds selling below par value.

a bond rated BBB and above by Standard & Poor's or Baa and above by Moody's.

a bond rated BB or lower by Standard & Poor's or Baa and below by Moody's.

a specific asset pledged against possible default on a bond.

a bond not backed by specific collateral.

a graph of yield to maturity as a function of term to maturity.

the net worth of common equity according to a firm's balance sheet.

net amount that can be realized by selling the assets of a firm and paying off the debt.

the present value of a firm's expected future net cash flows discounted by the required rate of return.

a formula stating that the intrinsic value of a firm equals the present value of all expected future dividends.

financial valuation method used to estimate the value of an investment, project, or company based on its expected future cash flows.

a form of the dividend discount model that assumes dividends will grow at a constant rate.

fraction of earnings paid out as dividends

the ratio of a stock's price to its earnings per share.

financial metric that compares a company's market price to its book value, essentially showing how much investors are paying for each dollar of net assets. calculate by
P/B = Market Price per share/Book Value per share

is a valuation metric that compares a company's stock price to its revenues per share. Calculated by
P/S Ratio= Market Cap/ Total Sales (Revenue)

when to use- for companies with low or negative earnings, early-stage or growth companies, industries with varying profit margins, assessing market sentiment.

Ratio of P/E multiple to earnings growth rate.