14. Abbot Enterprises issued a bond having a par value of $1,000, a 10 year life and a % coupon rate. If interest is paid quarterly and the discount rate is 11%, what is the value of the botad? a. $879.61 c. $1,054.23 b. 8911.66 d. 31.123.34 15. Philo, Inc. has an issue of preferred stock outstanding that pays an annual dividend of $7.20. If the discount rate for the stock is 11%, what is the stock's value? a. $65.45 b. $72.27 c. $78.54 d. $79.87 16. What is the fair value of the stock for which no dividend will be paid for next six years, but $1.00 dividend per share will be paid 7 years from now and then will grow at 3% every year? Assume that the discount rate for the stock is 10%. a. $8.07 b. $10.74 c. $19.89 d. $23.54 17. Quincy Enterprises issued a bond having a par value of $1.000, a 5 year life and a 10.6% coupon rate. If interest is paid semiannually and the discount rate is 10% rate of return, what is the current value of the bond? a. 5878.90 b. 8912.55 c. $1,023.17 d. 91.123.54 (Use the following data to answer the next three questions.) Rate of Return if State Occurs State of Economy Probability of State of Economy Stock A Stock B Recession 0.20 0.06 -0.19 Normal 0.50 0.08 0.16 Boom 0.30 0.16 0.34 18. What is the expected retum on Stock A? a. 8.4% c. 12.1% b. 100% d. 14.2% 19. What is the standard deviation of return on Stock B? a. 7.6294 c. 13.11% b. 12.079 d. 18.43% 20. Which is riskier? a. Stock A is riskier c. They have the same risk b. Stock B is riskier d. Both are risk-free