1. A corporate bond pays 6 percent interest. How much would a municipal bond have to pay to be equivalent to this on an after-tax basis if you are in the 15 percent tax bracket?
2. Your portfolio has provided you with returns of 8.6 percent, 14.2 percent, -3.7 percent, and 12.0 percent over the past four years, respectively. What is the geometric average return for this period?
3. Gamma Corp. is expected to pay the following dividends over the next four years: $5, $12, $18, and $1.80. Afterward, the company pledges to maintain a constant 4 percent growth rate in dividends, forever. If the required return on the stock is 14 percent, what is the current share price?