16. Five years ago a $1,000 face value 7% semi annual coupon bond was selling for $1218.93. Since then, the market return decreased by two percentage points. The bond pays interest semiannually and now has 10 years to maturity. The bond's price today is:

17. International Paper stock will pay a dividend of 2.25. If the expected growth rate is 6% while the market return is 12%, what is the price you are willing to pay for this stock?

18. The current price of Kraft Foods stock is $30.00 and its last dividend was $1.16. What is its return if dividends are expected to grow indefinitely at 6 percent?