FINC3310 Corporate Financial Management Dr. HJ. Abraham Lin Department of Finance Koppelman School of Business 23. Suppose a firm's stock is elling for $10,40. it just paid a $1 dividend, and dividends are ex grow at 4% per year, what is the required return? a. 8% b. 9% c. 10% d. 11% e. 12% f. 14% g. 15% h. 17% 24. Consider a bond with a coupon rate of 10% and annual coupons. the bond has 5 years to maturity. The yield to maturity is 9%. What is the value of the bond? (in dollars) The par value is $1,000, and a, 880 b. 937 . 963 d. 984 e. 997 f. 1039 g. 1119.5 h. 1023 25. Consider a bond with a 10% annual coupon rate, 15 years to maturity and a par value of The current price is $928.09. Yield to Maturity is $1,000. a.8% b. 9% c. 10% d. 11% e. 12% f. 13% g. 15% h. 17% 26. Consider a bond with a 9% annual coupon rate, 20 years to maturity and a par value of S1.00. The current price is $818.18. the current yield is a. 8% b. 9% c. 10% d. 11% e, 12% f. 13% g. is% h, 17% 27. Suppose you are thinking of purchasing the stock of Moore Oil, Inc. You expect it to pay a $2.2 dividend in one year, and you require a return dividend in one year, you expect a dividend of $2.40 in two years and a stock price of $14.60 at the end of year 2. Now how much would you be willing to pay? (choose the closest one) of 10% on investments of this risk. In addition to the a.$15 b. $14 c. $10 d.$11 e. $12 f.$13 8 $16 h. $17 i. $18 28. Jefferson Mills just paid a dividend of $2 per share on its stock. The dividends are expected to grow at a constant rate of 8 percent per year, indefinitely. What will the price of this stock be in 7 years if investors require a 15 percent rate of return? a. $35 b. $24 c.$40 d.$11 e. $52.88 f. $63.4 8. $56.66 h. $47.6 .$38.9 29. The next dividend payment by Hilide Markets will be $2.6 per share. The dividends are anticipated to main tain a 10 percent growth rate forever. The stock currently sells for $65 per share. What is the dividend yield? a. 4% b. 4.4% c. 14% d. 14.4% e, 5% f. 7% g. 15% h. 17% i. 9.6% j. 10.3% 30. Your parents set up a trust fund for you 10 years ago that is now worth $31,474.42. f the fund earned 7% per year, how much did your parents invest in dollars? a. $10,000 b. $16,000 c.$20,000 d. $24,000 e. $30,000 f.$35,000 31. Suppose a bond with a 10% coupon rate and annualcoupons has a face value of $1,000, 5 years to maturity and is selling for $1,080. Please calculate Yield to Maturity of this bond. a. 8% b. 9% c. 10% d. 11% e. 12% f. 13% g. 1596 h. 17%