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Juan owns investment A and 1 bond B . The total value of his holdings is $ 3 , 1 0 0 . 0 0

Juan owns investment A and 1 bond B. The total value of his holdings is $3,100.00. Bond B has a coupon rate of 19.14 percent, par value of $1,150.00, YTM of 9.47 percent, 12 years until maturity, and semi-annual coupons with the next coupon due in 6 months. Investment A is expected to produce cash flows forever. The next cash flow is expected to be $108.00 in 1 year, and subsequent annual cash flows are expected to increase by g each year forever. The expected return for investment A is 16.99 percent. What is g, the annual growth rate for the annual cash flows paid by investment A?
11.43%(plus or minus 2 bps)
9.29%(plus or minus 2 bps)
7.70%(plus or minus 2bps)
26.28%(plus or minus 2bps)
none of the answers are within 2 bps of the correct answer
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