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Q1. You bought a bond five years ago for $935 per bond. The bond is now selling for $980. It also paid $75 in interest

Q1. You bought a bond five years ago for $935 per bond. The bond is now selling for $980. It also paid $75 in interest per year, which you reinvested in the bond. Calculate the realized rate of return earned on this bond.

Q2. A stock you are evaluation is expected to experience supernormal growth in dividends of 8 percent. The stock paid a dividend of $5.50 last year and the required rate of return on the stock is 10 percent. Calculate the stocks fair present value.

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