In the constant-growth dividend valuation model, the required rate of return on common stock can be shown to be equal to the sum of the dividend yield plus ____.

a.Yield-to-maturity

b. Cost of capital

C.Present value yield

d.Price appreciation yield

A General Electric 7 1/2s 96 bonds closed at 98. What is the current yield?

a. 7.65%

b. 7.81%

C.7.50%

d. 7.34%

A Dow Chemical bond carries a 9 percent coupon, pays interest semiannually, and has 10 years to maturity. What is the bond's yield to maturity if the bond is selling for $937.75?

a. 8.0%

b.10.0%

c. 9.0%

d. none of the above

Determine the value of a LASKA 6.25% cumulative preferred stock, Series D, par value of $75 to an investor who requires a 9.5% rate of return on security with this risk.

a. $65.79

b.$49.34

c.$75.00

d$114.00

___________ risk CAN be diversified away by investing in a diversified portfolio.

a. Systematic

b. Business-specific

c.Unsystematic

d.Both b& c