1. Stephens Inc. has $1,000 face value bonds that currently sell for $985. The bonds have 11 years to maturity, a 6% coupon rate and make semi-annual coupon payments. What is the yield to maturity of these bonds?

2. Cliff Corp. has $1,000 face value bonds outstanding with 8 years to maturity. The bonds have a coupon rate of 7% and make semi-annual coupon payments. Bonds of similar risk have a yield to maturity of 6.6%. What is the value of a Cliff Corp. bond?

3. Farahs Fashions (FF) just paid their first ever dividend of $1.20 per share. FF expects dividends will increase at the rate of 4% annually indefinitely. If the appropriate discount rate is 10%, then what is the value of a share of FF stock?