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XYZ has now share of stock and one bond. The total value of the two securities is $1,400. The stock pays annual dividends. The next
XYZ has now share of stock and one bond. The total value of the two securities is $1,400. The stock pays annual dividends. The next dividend is expected to be $24.00 and paid in one year. In two years, the dividend is expected to be $14.00 and the stock is expected to be priced at $195.00. the stock has an expected return of 17.80 percent per year. The bond has a coupon rate of 13.60 percent and a face value of $1,000.; pays semi annual coupons with the next coupon expected in 6 months; matures in 4 years. What is the YTM of the bond?
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