1. Your credit card company charges you 1.15 percent per month. What is the annual percentage rate on your account?
a.10.85 percent
b.9.93 percent
c.13.80 percent
d.12.86 percent
e.9.70 percent
2. The required return (that would be ri) on Erica & Erica’s Clothing Corporation stock is 14%. The stock's dividend is expected to grow at a constant rate of 8%, and it currently sells for $50 a share, which is also its intrinsic value. Which of the following statements is CORRECT?
a. The stock's dividend yield is 7%.
b. The stock's dividend yield is 8%.
c. D1 is $3.00.
d. The stock price is expected to be $55 a share one year from now.
e. The stock price is expected to be $57 a share one year from now.