11. ABC Fund has purchased a bond with 17 years remaining until maturity and a $1,000 face value. The bond is currently selling at a price of $1,070. The bond offers 11% coupon rate with interest paid annually. The bond may be called in 5 years at a call price of $1,050. What is the bonds yield to call (YTC)

12. You have just invested in a bond that offers an annual coupon rate of 6%, with interest paid annually. The face value of the bond is $1,000 and the interest rate in the market is 5%. The bond matures in 10 years. What is the bonds price?

13. Mining Fund has purchased a bond with 8 years remaining until maturity and a $1,000 face value. The bond is currently selling at a price of $950. The bond offers 9% coupon rate with interest paid annually. The bond may be called in 4 years at a call price of $1,060. What is the bonds yield to maturity (YTM)?

14. Your brother has just invested in a discount bond that offers an annual coupon rate of 9%, with interest paid annually. The face value of the bond is $1,000 and the difference between its yield to maturity and coupon rate is 4%. The bond matures in 8 years. What is the bonds price?

15. Stock A has an expected return of 12 percent, a beta of 1.2, and a standard deviation of 20 percent. Stock B has an expected return of 10 percent, a beta of 1.2, and a standard deviation of 15 percent. Portfolio P has $900,000 invested in Stock A and $300,000 invested in Stock B. The correlation between Stock As returns and Stock Bs returns is zero (that is, r = 0). Which of the following statements is most correct?

16. Suppose you held a diversified portfolio consisting of 10 different common stocks, investing $500 in each stock. The portfolios beta is 1.9. Now suppose you decided to sell one of the stocks in your portfolio with a beta of 0.8 for $500 and use the proceeds to buy another stock with a beta of 1.25. What would your portfolios new beta be?

17 Assume that you purchase a 6-year, 8% savings certificate for $1,000. If interest is compounded annually, what will be the value of the certificate when it matures?

18 How much would you be willing to pay for an investment that would return $800 each year at the end of each of the next 6 years? Assume an annual interest rate of 5%.

19. Tata Corp. is experiencing rapid growth. Dividends are expected to grow at 25 percent per year during the next three years, 15 percent over the following year, and then 8 percent per year indefinitely. The required return on this stock is 13 percent, and the stock currently sells for $76 per share. What is the projected dividend per share for the coming year?

20. Antiques R Us is a mature manufacturing firm. The company just paid a $10.46 dividend, but management expects to reduce the payout by 4 percent per year indefinitely. If you require an 11.5 percent return on this stock, what will you pay for a share today?