1. Assuming Anglo Company will grow at a constant rate of 15% a year into the indefinite future. It just paid dividends of $2 a share. The rate of return on stocks similar to Angelo is about 21%. What should a share of Angelo sell for today?

a. 61.99

b. 38.33

c. 42.57

d. 45.71

e. 67.22

2. The current price of a stock is $55, the annual risk-free rate is 8%, and a 1-year call option with a strike price of $66 sells for $8.60. What is the value of a put option, assuming the same strike price and expiration date as for the call option? (Chapter 8, PUT-CALL Parity).

a. 11.852

b. 12.999

c. 15.278

d. 17.696

e. 14.526