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4) You have ju st purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 8 percent annually, with interest being

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4) You have ju st purchased a 10-year, $1,000 par value bond. The coupon rate on this bond is 8 percent annually, with interest being paid each 6 months. If you expect to earm a 10 percent simple rate of return on this bond, how much did you pay for ir? 5) A share of common stock has a current price of $82.50 and is expected to grow at a constant rate of 10 percent. If you require a 14 percent rate of return, what is the current dividend (Do) on this stock? Assume the risk-free rate of return (rer) is 5 percent, the market risk premium (RP) is8 percent, and an investment exists that has a beta (B) equal to 1.5.According to the Capital Asset Pricing Model (CAPM), what should be the return of that investment? 6)

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