Junior just received his annual bonus and is looking to


Junior just received his annual bonus and is looking to invest it in one of two potential investments. Junior is considering a 15-year 8% coupon bond issued by Home Co that is currently selling for $1,032.67. His other option is to buy stock in Residential Inc. Residential just issued a $1.05 dividend and expects to grow at 5.5%. Residential current stock price is $45.82. If both investments are fairly priced and Junior intends to hold the investment indefinitely, which offers a higher return?

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Financial Management: Junior just received his annual bonus and is looking to
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