ABC Corp. just issued some new preferred stock. The issue will pay a $3 quarterly dividend in perpetuity, begining 12 years from now. If the market requires a 8% return on this investment, how much does a share of preferred stock cost today?

Suppose that you buy a semi-annual coupon bond with coupon rate of 10%; the market price of $1,120, and the time to maturity of 17 years. Seven years from now, the YTM on your bond is expected to decline by 2%, and you plan to sell. What is the holding period yield (HPY) on your investment?

Consider the following bond quotes for ABC and XYZ Corp.

It is June 27, 2020. You must provide equations for each of the questions.

Issuer Name	Coupon	Maturity	Last	Change	Yield%
ABC Corp.	4.375	12/27/2038	92.5133	-0.315	?????
XYZ Corp	0.000	06/27/ 2031	46.9150	+0.234	?????

Note that yields for ABC and XYZ Corp bonds are all semiannually compounded.

1. (6 points) Supply the missing information (yield%) for each of the bonds.

2. (6 points) What are the current yield and expected capital gains yield for the next year for ABC Corp bond?

3. (2 points) What was the yesterdays price for ABC Corp bond?