1) The Lone Star Company has $1,000 par value bonds outstanding at 10% coupon rate. The bonds will mature in 20 years and the company makes semi-annual payments. Compute the current price of the bonds if the present yield to maturity is: a) 6 % b) 8% c) 9% d) 11% e) 12%

2) Toxaway Telephone Company has $1,000 par value bond outstanding that pays 6% coupon rate. The bond will mature in 15 years and makes semi-annual payments. Compute the yield to maturity of the bond if the current price is: a) $800 b) $900 c) $950 d) $1050 e) $1100

3) A stock just paid a dividend of $1 per share and dividends are expected to grow by 20% each year and you want a return of 25%. What is the value of the stock?

4) A stock just paid a dividend of $2 per share and dividends are expected to grow by 10% each year. If the current market price of the stock is $44 per share what is your expected rate of return?