Question

You have a sample of returns observations for the Malta stock fund. The four returns are 8 percent, 6 percent, 12 percent, 4.0 percent. What is the variance of these returns?

Zantax firm offers a 7 year, zero coupon bond. The yield to maturity is 6.5 percent. What is the current market price of a $1,000 face value bond? (It is not a semiannual)

Zubeda’s common stock sells for $52.50 a share at a required rate of return of 8.5 percent. The company just paid its annual dividend of $1.50. What is the rate of growth of its dividend?

Answer #1

A 20-year, semiannual coupon bond sells for $958.56. The bond
has a par value of $1,000 and a yield to maturity of 7.02 percent.
What is the bond's coupon rate?
A stock currently sells for $58. The dividend yield is 3.6
percent and the dividend growth rate is 4.9 percent. What is the
amount of the dividend that was just paid?

The bonds issued by Sota Inc. bear a 6.5 percent coupon, payable
semiannually. The bond matures in 14 years and has a $1,000 face
value. Currently, the bond sells at par. What is the yield to
maturity?
The common stock of Pizzaria pays an annual dividend that is
expected to increase by 8 percent annually. The required rate of
return on the stock is 12 percent and sells for $70.50 a share.
What is the expected amount of the next...

soca co. offers a 9 percent coupon bond with semiannual payments
and a yield to maturity of 7.50 percent. The bonds mature in 18
years. What is the market price of a $1,000 face value bond?

ABC, Inc. offers a bond with a coupon of 9 percent with
semiannual payments and a yield to maturity of 7.75 percent. The
bonds mature in 14 years. What is the market price of a $1,000 face
value bond?

City Rentals has 44,000 shares of common stock outstanding at a
market price of $32 a share. The common stock just paid a $1.50
annual dividend and has a dividend growth rate of 2.5 percent.
There are 7,500 shares of $9 preferred stock outstanding at a
market price of $72 a share. The outstanding bonds mature in 11
years, have a total face value of $825,000, a face value per bond
of $1,000, and a market price of $989 each,...

Please answer Questions 4 and 12 on page 89 of the textbook, and
solve Problems 22 and 27 on page 91 of the textbook. Complete your
answer in Word, Excel, or both.
4. For each of the following situations, identify whether a bond
would be considered a premium bond, a discount bond, or a par
bond.
A bond’s current market price is greater than its face
value.
A bond’s coupon rate is equal to its yield to maturity.
A bond’s...

1. A bond's par value can also be called its
coupon payment.
present value.
market value.
face value.
2.Horizon offers a 12 percent coupon bond with semiannual
payments and a yield to maturity of 10 percent. The bonds mature in
16 years. What is the market price per bond if the face value is
$1,000?
$808
$911
$1,000
$1,158

Bonaime, Inc., has 7.8 million shares of common stock
outstanding. The current share price is $62.80, and the book value
per share is $5.80. The company also has two bond issues
outstanding. The first bond issue has a face value of $71.8
million, a coupon rate of 7.3 percent, and sells for 89 percent of
par. The second issue has a face value of $36.8 million, a coupon
rate of 8.3 percent, and sells for 88 percent of par. The...

Masterson, Inc., has 4 million shares of common stock
outstanding. The current share price is $76, and the book value per
share is $7. The company also has two bond issues outstanding. The
first bond issue has a face value of $105 million, has a coupon
rate of 5 percent, and sells for 95 percent of par. The second
issue has a face value of $90 million, has a coupon rate of 4
percent, and sells for 107 percent of...

1) Bonaime, Inc., has 7.9 million shares of common stock
outstanding. The current share price is $62.90, and the book value
per share is $5.90. The company also has two bond issues
outstanding. The first bond issue has a face value of $71.9
million, a coupon rate of 7.4 percent, and sells for 88.5 percent
of par. The second issue has a face value of $36.9 million, a
coupon rate of 8.4 percent, and sells for 87.5 percent of par....

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