1. Dividend is 6.25 of a par value. The interest rate for the stock is 8.15%. What is the highest WTP (Willingness 2 pay) for 1 share of stock.

2. a. Current price of bond is 112.825%. It has 4.26% semi-annual coupon rate. Issued 6 years ago. The maturity rate was 22 years ago. What is the yield to maturity? What is the EAR for it? Will the bond earn the presented YTM or not? Another company issues a bond with the same exact information. HOWEVER, it was issued two years before the bond above. If both fall by 50 points, which bond is better? A conversion option is available. Would the ytm be lower, higher, or the same?