1. Portfolio Expected Return An investor puts 36% of their money in Stock 1 with a 9.95% expected return, 31% of their money in Stock 2 with a 10.75% expected return and the rest in Stock 3 with an expected return of 13.35%. What is the portfolio's expected return?
2. A company issued a bond having a par value of $1,000, a 5 year life and a 10% coupon rate. If interest is paid annually and the discount rate is 10%, what is the value of the bond?
3. Three years ago, you bought a 10% bond that had 5 years to maturity for $950. Today, you sold the bond when it is yielding 10%. What is your annual rate of return for the three year period? All coupon payments are semi-annual.