1. Bond Valuation: Callaghan Motors' bonds have 10 years remaining to maturity. Interest is paid annually, they have a $1,000 par value, the coupon interest rate is 8% and the yield to maturity is 9%. What is the bond's current market price?
2. Yield to Maturity: A firm's bonds have a maturity of 10 years with a $1,000 face value, have an 8% semi-annual coupon, are callable in 5 years at $1,050, and currently sell at a price of $1,100. What are their nominal yield to maturity and their nominal yield to call? What return should investors expect to earn on these bonds?
3. Bond Valuation: Nungesser Corporation's outstanding bonds have a $1,000 par value, a 9% semiannual coupon, 8 years to maturity and an 8.5% YTM. What is the bond's price?
4. Explain the concept of stock price versus intrinsic value.
5. Is it better to invest in a stock that pays current dividends or one that has a high growth rate and why?