7. Consider three $1.000 face-value corporate bonds. Bond 1 is currently selling for $975 and matures in 10 years with semi-annualcompounding Bond 2 sells for $910 and matures in 3 years with semi-annual compounding Bond 3 sells for $950 and matures in 5 years with annual compounding. Calculate the current yield for bonds it all of them gave a coupon rate equal to 5. Which current yield is a better approximation of the vield to maturity? Bond 1 Bond 2 Bond3 A B. c A B . 8. An investor bought a convertible bond of the Company with face value of $1.000 coupon rate of 6% and with annual payments for 10 years. The market rate is 7%. The bond can be converted into 27 shares of common equity. The company A's current stock are trading at $335 pershare. What will be the best option for the investor? Convert to bond and sell it Convert to bond and hold it Convert to equity and set it 2 Holding A expects to pay an annual dividend of $5.0 per share and stock analysts expect the dividend to prowth by 7. If the company's current share price is $58.5, what would be the required rate of return? A 13.4% 15.5% 16.15 10. Suppose you want to buy a stock, which will pay $15 dividend in next year, the price of this stock will be Sas in next year. How much are you willing to pay for this stock today. If your required rate for investment is 16%? A 76 a. 75 C73 11. A bank has reserves of 3,000 and deposits of 20,000. Assume that the required reserve ratio is 11. Depositor comes to the bank and withdraws 1.500 in cash. After the withdrawal, does the sank hold excess reserves (ER)? is it meeting the required reserve ratio (RRR)? No ER, does not meet RRR NO ER, meet RRR ER of 535, meet RRR A B. C 12. A bank has reserves of 1,500 and deposits of 8,000. Assume that the required reserve ratio is 15% How much is the bank required to hold as reserves, and how much can be held as excess reserve, if any