Naggpawh fabrics has issued a 30 year par value bond that is callable in 5 years. If the coupon rate is 5.5% payable semi-annually, what is this bond’s yield to call if the yield to maturity is 8% and the call premium is one year’s interest (55 dollars)?
What is the value of a share of stock of Leonard Leakey Hofstadter, Inc. to an investor who requires a 12 percent rate of return if the company's current dividend is $1.20? Assume that the growth rate is 7 percent.