For an investment the market risk premium is 7 and the beta


1. Flora? Co.'s bonds, maturing in 8 ?years, pay 12 percent interest on a $1,000 face value.? However, interest is paid semiannually. If your required rate of return is 6 ?percent, what is the value of the? bond? How would your answer change if the interest were paid? annually?

2. How many years will it take an investment of $1,000 to grow to $2,500 if the investment pays 4% p.a. compounded quarterly

3. For an investment, the market risk premium is 7% and the beta is 1.8. If the risk-free rate is 5%, what is the investment's expected rate of return?

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Financial Management: For an investment the market risk premium is 7 and the beta
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