1. What is the price of perpetuity, a bond that never matures, if the annual coupon is $90 and the required return is 8%?
2. Great Wall Pizzeria issued 9-year bonds one year ago at a coupon rate of 5.6 percent. If the YTM on these bonds is 8 percent, what is the current bond price?
3. A stock has a beta of 1.04, the expected return on the market is 10 percent, and the risk-free rate is 3.5 percent. What must the expected return on this stock be?