1. A firm's capitalization rate is 22%, while the firm invests in projects with ROE of 20%. The growth in the firm is described by this relationship: The firm's year-end dividend will be $2 per share, while EPS is $5. What is the stock price?
2. What is the PV of growth opportunities?
3. ROE is 14% and b is .65. Div1 is $1, Div2 is $1.20, Div3 is $1.37, and Div4 is $1.50. Price4 is expected to be $41.35. If the cost of equity capital is 14.50%, what is the intrinsic value of the stock?
4. Coupon pays 7%. Semi-annual coupon payments. 45 days have passed since the past payment. Par is $1000. Flat price is $975. What is the Invoice Price?
5. 10% annual coupon. 20 year bond. Par is $1000. What is the present value of the Par portion of the total value at the time of issuance?
6. 10% annual coupon. 20 year bond. Par is $1000. One year into the bond's life (19 years to maturity), the market rates are cut down to 8.5%. What is the value of the bond?
7. 6% coupon. 25 year bond. Pays semiannually. $1000 par. Price is $1,300. What is the Yield to Maturity? 25. Bond price is $1,300. Semiannual coupon is $18 (every 6 months). What is the Current Yield?