1.a. Burp-Cola Company just finished making an annual dividend payment of $2 per share on its common stock. Its common stock dividend has been growing at an annual rate of 10%. Kelly Scott requires a 16 percent annual return on this stock. What intrinsic value should Kelly place on one share of Burp-Cola common stockIf dividends are expected to continue growing at a constant 10% annual rate. What if the annual dividend growth rate is expected to decrease to 9%?

b.An investor has two bonds in her portfolio, Bond A and Bond B. Each bond matures in 4 years, has a face value of $1,000, and has a yield to maturity of 9.6%. Bond A pays a 10% annual coupon, while Bond B is a zero-coupon bond. If the yield to maturity of each bond remains at 9.6% over the next 4 years, calculate the value of the bonds at each of the following years to maturity