QUESTION 1 In March 2018, suppose the yield for a corporate bond with the same maturity and coupon which is rated as BBB was 7% and the yield for AAA was 3% One year later, the yield for a BBB bond was 9% and the yield for a AAA bond was 2%. Which statement reflects the conventional wisdom when provided with this information? Investors expect a higher premium for growth opportunity in 2019 compared to 2018 Investors expect a higher premium for credit risk in 2019 compared to 2018 Investors expect a higher premium for growth opportunity in 2018 compared to 2019 Investors expect a higher premium for credit risk in 2018 compared to 2019 O None of the above QUESTION 2 TP "If an investor purchases a bond when its current yield is higher than the coupon rate, then the bond's price will be expected to: o "decline over time, reaching par value at maturity." "increase over time, reaching par value at maturity." be less than the face value at maturity. exceed the face value at maturity. QUESTION 3 A stock is expected to pay dividends of $1.45 per share in Year 1 and $1.68 per share in Year 2. After that, the dividend is expected to increase by 3.5% annually. What is the current value of the stock at a discount rate of 15% (in $ dollars)? $