Mov Inc. has 10,000 coupon bonds and 15,000 shares of equity. Each bond is sold at $1000 with a face value of $1000 and pays a coupon rate of 8% each year until it matures 10 years later. Mov's systemic risk is 0.5. The riskless rate is 2% and the market expected return is 9%.

a. What is BBB's expected return? (5')

b. If Mov just paid a dividend of $2 and its dividend is expected to grow at a constant rate of 2%. Determine the stock price today using the expected return calculated in part a. (10')

c. What is the yield to maturity of the bonds? (5')

d. Given the tax rate is 18%, what is Mov's weighted average cost of capital? (10')