17. (a) An investor bought an \8 coupon rate straight bond with 20 years of...
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17. (a) An investor bought an \8 coupon rate straight bond with 20 years of remaining maturity. The par value is \\( \\$ 1,000 \\). The YTM on this semiannual coupon bond was \8 at the time of purchase, but decreased to \7.5 a year later when the investor sold the bond. What is the investor's holding period return? (3pts) (b) A company has a market capitalization rate of \11, a dividend growth rate of \6, and a payout ratio of \50. Earnings for the current year \\( \\left(\\mathrm{E}_{0}\ ight) \\) are \\( \\$ 2 \\) per share. What is the intrinsic value of this company's stock? (3pts)
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