10. Akron Corporation currently pays an annual dividend of $1.46 a share and plans on increasing that amount by 2.75% annually. Sogang Corporation currently pays an annual dividend of $1.42 a share and plans on increasing its dividend by 3.1% annually. Given this information, you know for certain that the stock of Sogang Corporation has a higher _____ than the stock of Akron Corporation.

01) market price O2) dividend yield 03) total return 04) capital gains yield

11. Akron Corporation is considering a five-year project that will require $720,000 for the purchase price of new fixed assets and $18,000 for the shipping cost of new fixed assets. The new fixed assets will be depreciated straight-line to a zero book value over five years. At the end of the project, the fixed assets can be sold for 18% of their original cost. The project is expected to generate annual sales of $679,000 with costs of $321,000. The tax rate is 22% and the required rate of return is 15.2%. What is the amount of the after-tax salvage value of the new fixed aseets at the end of the project life?

01) 132,840.00 O2) 101,088.00 O3) 103,615.20 04) 129,600.00

12. A $1,000 face-value bond has a coupon rate of 7%, a market price of $989.40, and 10 years left to maturity. Coupon interest is paid semiannually. If the inflation rate is 2.2%, what is the YTM (Yield to Maturity) when expressed in real terms based on the exact Fisher effect?

01) 4.95% 02) 5.03% O3) 4.68% 04) 4.84%