1. An issue of common stock s most recent dividend is $1.75. Its growth rate is 5.7 %. What is its price if the market s rate of return is 7.7 %?

a. $24.63 b. 87.50 92.50 d. none of these options

2. An issue of common stock is selling for $ 57.20. The year end dividend is expected to be $2.32, assuming a constant growth rate of 4 %, what is the required rate of return? a. 10.3 % b. 10.1 % c. 8.1 % d. none of these options

3. The relationship between a bond s price and the yield to maturity:

a. change at a constant level for each percentage change of yield to maturity

b. is an inverse relationship

c. is a linear relationship

d. change at a constant level for each percentage change of yield to maturity and is an inverse relationship