1. Time needs to invest 400 in new assets. They use a capital structure that is 40% debt and 60% equity. Next years income is expected to be 500. Find the amount for the residual dividend.
2. A bond is currently selling at 1.10 on its par value of $1,000. This bond has a maturity of 10 years and a coupon rate of 5%, payable semi-annually. If the inflation rate is 3%, what is the real yield on this bond?