Question
9) Your firm has just issued a 10 - year $1,000.00 par value, 10% annual coupon bond for a net price of $964.00. What is
9) Your firm has just issued a 10-year $1,000.00 par value, 10% annual coupon bond for a net price of $964.00. What is the yield to maturity?
10)Your firm has preferred stock outstanding that pays a current dividend of $3.00 per year and has a current price of $39.50. You anticipate that the economy will grow steadily at a rate of 3.00% per year for the foreseeable future. What is the market required rate of return on your firm's preferred stock?
11)Use the security market line to determine the required rate of return for the following firm's stock. The firm has a beta of 0.80, the required return in the market place is 12.50%, and the risk-free rate of return is 3.50%
12) Use the dividend growth model to determine the required rate of return for equity. Your firm anticipates paying a dividend of $2.25 per share next year, has a recent price of $40.20 per share, and anticipates a growth rate in dividends of 3.00% per year for the foreseeable future.
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