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5 points Compute the new price of the Bond. Assume M.K. Electronics issued bonds 12 years ago at $1,000 per bond. These bonds had a
5 points Compute the new price of the Bond. Assume M.K. Electronics issued bonds 12 years ago at $1,000 per bond. These bonds had a 30-year life when issued and the annual interest payment was then 17 percent. This return was in line with the required returns by bondholders at that point in time as described in the following image/table. * Assume that 12 years later, the risk premium is now 2 percent and inflation has decreased to 5 percent appropriately reflected in the required return of the bonds. Inflation premium Risk premium Real rate of return Total return 7% 5% 5% 17 Your answer 3 points Enbridge Inc. had the following pattern of earning per share over the last five years. The earnings per share have been growing at a constant rate (on a round basis) and will continue to do so in the future. Dividend represents 20% of earning. What is the dividend payment of year 2019? Year EPS 2014 $4.00 2015 $4.24 2016 $4.49 2017 $4.76 2018 $5.05 Your answer What is the anticipated stock price of Enbridge Inc. at the end of Year 2018 3 points when the required rate of return is 10%? Your answer 1 point If the market price of the Enbridge's Inc. stock is $30, would you buy the stock of? Why or why not explain briefly. *(Maximum two sentences) Your
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