11. A zero coupon bond is selling for $476. The bond has a face value of $1,000 and matures in 8 years. Your friend asks you if he should buy the bond. He tells you his required return is 9 percent. Would you recommend he buy the bond or not? Explain your answer. 12. Assume that you have $330.000 invested in a stock that is retuming 11.50%, $170,000 invested in a stock that is returning 22.75%, and $470,000 invested in a stock that is returning 10.25%. The risk free rate is 2.1% and inflation is 5%. What is the expected return of your portfolio? A) 15.6% B) 12.9% C) 18.3%. D) 14.8% 13. Miller's preferred stock is selling at $54 on the market and pays an annual dividend of $4.20 per share. a. What is the expected rate of return on the stock? b. If an investor's required rate of return is 9%, what is the value of the stock to that investor? c. Considering the investor's required rate of return, does this stock seem to be a desirable investment? 14. Over the last 5 years, the average nominal rate of return of 90 day Treasury bills was 1.02%, Saltine Co.'s average nominal stock retum was 8.9%, large company stocks average nominal return was 15%, and the inflation rate averaged 2.7%. The real rate of Saltine's stock return is A) 6.8%. B) 6.0% C) 5.1%. D) 4.3%