1. Eight years ago you bought a $1,000 par bond with a 5% semi-annual coupon and 15 years to maturity. If the yield to maturity is currently 3.8%, what is the current price of the bond?
2. The return on US T-Bills is 6%, inflation is 3% and the risk premium of the S&P 500 is 12%. If a stock has a beta of 1.3, what is the expected real rate of return for the stock?
3. How do we use free cash flow to evaluate business performance.