1. Staind, Inc., has 8 percent coupon bonds on the market that have 7 years left to maturity. The bonds make annual payments. If the YTM on these bonds is 10 percent, what is the current bond price?
$1,030.00
$857.50
$1,108.13
$947.76
$902.63
2. Thirsty Cactus Corp. just paid a dividend of $1.55 per share. The dividends are expected to grow at 30 percent for the next 7 years and then level off to a 8 percent growth rate indefinitely.
If the required return is 14 percent, what is the price of the stock today?
$87.17
$90.73
$88.95
$69.96
$.17