1. Countess Corp. is expected to pay an annual dividend of $4.63 on its common stock in one year. The current stock price is $74.11 per share. The company announced that it will increase its dividend by 3.75 percent annually. What is the company's cost of equity.
2. Palmer Products has an outstanding bond that makes annual coupon payments, has an annual coupon rate of 8 percent, a maturity of 11 years a face value of $1,000 and a current price of $865.00. What is the yield to maturity (YTM) on the bond?