1. If the four-year, zero-coupon, risk-free, $100,000 face value bond sells for $89,537, its yield to maturity is ______________.
2. A risk-free, zero-coupon bond with a face value of $2,000 has 15 years to maturity. If the YTM is 5.8%, which of the following would be closest to the price this bond will trade at?
3. What is the yield to maturity of a five-year, $5000 bond with a 4.5% coupon rate and semiannual coupons if this bond is currently trading for a price of $4876?
4. ABC Industries will pay a dividend of $3.80 per share next year. It is expected that this dividend will grow by 6% per year each year in the future. The current price of ABC's stock is $44.5 per share. What is ABC's equity cost of capital?