San Pellegrino Mineral Water, Inc., will pay a quarterly dividend per share of $1 at the end of each of the next 12 quarters. Thereafter, the dividend will grow at a quarterly rate of 0.5%, forever. The appropriate rate of return on the stock is 10%, compounded quarterly. What is the current stock price?

ART Vandelay Inc. has two different bonds currently outstanding. Bond A has a face value of $40,000 and matures in 20 years. The bond makes no payment for the first 6 years, pays $2000 semiannually for the subsequent eight years, and finally $2500 semiannually for the last 6 years. Bond B also has a value of $40,000 and matures in 20 years. However, it makes no coupon payments over the life of the bond. If the stated annual interest rate is 12%, compounded semiannually, a. What is the current price of Bond A? b. What is the current price of Bond B