1. If a company is planning on paying the following dividends for the next 4 years, $.40 next year, $.85 for the following year, $1.25 in year 3, and $1.75 in year 4, how much would the stock be worth if they will grow at 9% for the foreseeable future if the current cost of capital is 13.6%?
2. PLC Inc. just sold a bond with 50 warrants attached. The bonds have a 20-year maturity and an annual coupon of 12%, and they were issued at their $1,000 par value. The current yield on similar straight bonds is 15%. What is the implied value of each warrant?
3. Convertible debentures for Kulik Corporation were issued at their $1,000 par value in 2012. At any time prior to maturity on February 1, 2032, a debenture holder can exchange a bond for 25 shares of common stock. What is the conversion price, Pc?