1. Your company is considering issuing a perpetual bond that pays a 9% coupon on a $1000 par bond. The current market interest rate for this type of security is 7%. At what price would you expect the bond to sell in the market?
2. You own a stock portfolio invested 30 percent in Stock Q, 30 percent in Stock R, 30 percent in Stock S, and 10 percent in Stock T. The betas for these four stocks are .82, 1.20, 1.21, and 1.38, respectively. What is the portfolio beta? (Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., 32.16.)