Homework: Stock & Bond Valuations Ant
Competencies Measured
By successfully completing this homework, you will demonstrate your proficiency in the course competencies through the following homework guide criteria:
1. Competency 1: Analyze financial environments and concepts.
a. Explain what a call provision (call feature) allows (bond) issuers to do.
b. Explain why the S&P 500 Index might be a better measure of stock market performance than the Dow Jones Industrial Average.
2. Competency 2: Apply financial computations and processes.
a. Calculate five bond valuation problems correctly.
b. Calculate five stock valuation problems correctly.
3. Competency 3: Communicate effectively and professionally.
a. Convey clear meaning through appropriate word choice and usage.
Focus on bond and stock valuation problems and questions.
In this homework, the emphasis is on calculating the value of bonds and stocks. You will learn about the common features of bonds and learn to differentiate among the types of bonds. The focus then shifts to the mathematics of bond valuation (bond valuation model using the TVM concept). You will also learn about the factors that affect a bond's price and the relationship between changes in interest rates and bond prices.
In addition to learning about bonds, explore the various components of stock returns, common stock valuation models (such as constant dividend growth and variable growth), the use of the price/earnings (P/E) ratio, and preferred stocks valuation.
Introduction
This homework focuses on the TVM concept and how it relates to bond and stock valuations.
Instructions
Complete and submit the Homework Template [XLSX].
Format your homework according to the give formatting requirements:
1. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the homework, the course title, the student's name, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.