37. MIKE just purchased bonds for $38 million that have a par value of $40 million, five years remaining to maturity, and a coupon rate of 12 percent. It expects the required rate of return on these bonds to be 10 percent two years from now. At what price could Sun Devil Savings sell these bonds for two years from now?

a.

30,052,000

b.

37,052,000

c.

11,937,120

d.

41,989,120

23. If your credit card calculates the interest based on 19.5% APR, what is the annual effective interest rate?

a.

21.34%

b.

1.467%

c.

1.458%

d.

22.36%

7. Nasar Corp. dividend is assumed to grow at a rate of 4%. The dividend is currently $2.00 per share. The risk-free rate is currently 2%, the 10-year treasury is 6%. The investor required rate of return is 9%. What is the value of Nasar Corp. Common stock?

a.

$41.60

b.

$52

c.

$40