CSC1 Exam Dumps : Canadian Securities Course Exam 1

To calculate the first coupon payment for Brice's real return bond, we follow these steps:

Step 1: Determine the adjusted principal.

The bond is a real return bond, meaning its principal is adjusted for inflation based on the Consumer Price Index (CPI). The initial principal is$10,000, and CPI increases by0.8%over six months.

Step 2: Calculate the semi-annual coupon payment.

The coupon rate is5% annual, paid semi-annually, so each coupon payment is based on half the annual rate:

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Conclusion:

The first coupon payment Brice will receive is$252.

References:

Canadian Securities Course (CSC), Volume 1, Chapter 6: Fixed-Income Securities – Features and Types. Discussion on real return bonds and their adjustment mechanism for inflation​.

Canadian Securities Course (CSC), Volume 1, Chapter 7: Fixed-Income Securities – Pricing and Trading. Calculation methodologies for bond payments​.

The gain is calculated as:

Buying Price:5,000 shares purchased at $15.20 = $76,000.

Selling Price:5,000 shares sold at $15.25 = $76,250.

Profit Calculation:$76,250 - $76,000 =$1,000.

This reflects the gain from executing the market orders at the respective bid-ask prices.

Retained earningsrepresent the portion of a company’s annual profit that is retained and not paid out as dividends. It is used to reinvest in the business or pay down debt.

B. Comprehensive incomeincludes all changes in equity except those from owner contributions or distributions.

C. Share capitalrefers to funds raised by issuing shares.

D. Gross profitis revenue minus the cost of goods sold, not the portion retained.

References:Volume 1, Chapter 11 ("Corporations and Their Financial Statements")​.