a.) What is the price today (in dollars and cents) of a stock whose dividend per share is currently $2.85 and who expects to pay this same dividend per share at the end of each future year forever? That is, the assumption is that the current dividend per share will never change. The stock's required rate of return is 7.15%.

b.) Troy is interested in buying a particular stock whose current dividend per share is $1.40. Troy estimates that the current dividend per share will increase at a rate of 3.05% per year forever. If Troy's estimates are correct, what is the best estimate of the stock price per share if the required rate of return is 15.00%.

c.) The current stock price of Delta Company is $18.45. At the end of the first year the stock is expected to pay a dividend of $2.15 per share. Also at the end of the first year the stock is expected to be priced at $20.15.

What is the dividend yield of Delta Company? _____% What is the capital gain yield of Delta Company? ____%

d.) John is looking to value a particular stock that is expected to pay the dividend of $1.15 at the end of each year for at least the next few years. John expects to to be able to sell the stock at the end of year two, just after he receives the dividend in that year, for $69 per share. Given this information, what is the estimate of the stock's price today if the required rate of return is 13.00%.

e.) John is evaluating a stock that he believes will pay a dividend equal to $1.85 in exactly one year from today. Further, John expects that in addition to the dividend he will be able to sell the stock for the amount $49 per share also one year from today. Using this information, what is the stock's price today if the required rate of return on the stock is 15.00%?

f.) A bond with 2 years to maturity is priced today at $901.20. The bond's coupon payment is $80, and its par value is $1000. Which of the following comes closest to the bond's yield to maturity?

g.) You are trying to price two bonds that have the same maturity and par value but different coupon rates and different required rates of return. Both bonds mature in 3 years and have par values of $1000. One bond has a coupon rate of 7% and a required rate of return of 7%. The other bond has a coupon rate of 5% and a required rate of return of 5%. What is the absolute value of the difference between the price of these two bonds?

h.) What is the price today (in dollars and cents) of a 3-year 10.95% coupon rate bond that returns the par value of $1000 at maturity. Use a required rate of return of 10.50%?

i.) What is the price today (in dollars and cents) of a 15-year zero coupon bond if the required rate of return is 8.99%. The bond face value is $1000.