1. Steve purchases preferred stock in Berklee Corporation, with each share paying a $2.50 dividend. This dividend will remain constant. If the publics required rate of return for Berklee stock is 8%, at what price should this companys stock sell?
2. Donna enters into an investment contract that will guarantee her 4% per year if she deposits $3,500 each year for the next 10 years. She must make the first deposit one year from today, the day she signs the agreement. How much will she have when she makes her last payment 10 years from now?