1. A $1000 par value bonds pays an 8% APR coupon semiannually. If the bond has 10 years to maturity and a YTM of 9%, what is its current yield?
A. 4.3%
B. 4 9%
C. 6.5%
D. 8.6%
E. 9.2%
2. A company just became public and anticipates that they will begin paying a $5 preferred dividend 10 years from now and it will be constant forever. If the required rate is 10%, what is the value of this stock today?
A. $17.56
B. $18.57
C. $19.28
D. $20.27
E. $21.20
3. What is the yield to maturity of a $1000 par value bond that pays an $75 annual coupon and has 6 years to maturity if its current price is $1080? (There’s rounding so pick the closest)
A. 5.5%
B. 5.7%
C. 5.9%
D.6.1%
E. 6.3%
4. A $1000 par value bonds pays an 8% APR coupon semiannually. If the bond has 10 years to maturity and a YTM of 10%, what is its after-tax current yield for an investor paying 25% taxes?
A. 5.7%
B. 5 9%
C. 6.5%
D. 6.9%
E. 7.2%