1. A 20-year bond with semiannual coupons and a coupon rate of 7% and par value of $1000 currently has a yield to maturity of 8%. The bond is callable in 10 years with a call price of $1100. What is the bonds yield to call?

2. You buy a bond with a par value of $1000 and a coupon rate of 8% with 18 coupons remaining. You hold the bond and receive 11 coupons. If the bond had a YTM of 8.2% when you bought it and 9.1% when you sold it, what was your annual holding period ROR?

3. A companys dividends will be as follows: Year 1= 2.25, Year 2= $2.80, long-term growth rate after year 2= 5.5%. If the market risk-free rate is 5%, the market risk premium is 4%, and the companys beta is 1.2, what is the intrinsic value of the firms stock?

4. Assume Firm A is expected to pay a dividend of $3.40 one year from today. Dividend growth is projected to be 5% and its stock price is $45. What is Firm As estimated cost of equity according to the dividend growth model?

5. Your company is considering a project that will cost $1 million. The project will generate after-tax cash flows of $250,000 per year for 7 years. The WACC is 14%, and the firms target D/E ratio is .5. The flotation cost for equity is 6%, and the flotation cost for debt is 3%. What is the NPV for the project after adjusting for flotation costs?