Wine and roses inc offers a 65 percent coupon bond with

Question

Wine and Roses, Inc. offers a 6.5 percent coupon bond with semiannual payments and a yield to maturity of 7.25 percent. The bonds mature in 13 years. What is the market price of a $1,000 face value bond?

 

$1,478.87 $937.54 $1,396.21 $1,541.33 $1,060.64

 

A zero coupon bond with a face value of $1,000 is issued with an initial price of $455.50. The bond matures in 18 years. What is the implicit interest, in dollars, for the first year of the bond's life? Use semiannual compounding.

$12.19

$11.06

$10.17

$6.09

$20.34

 

Michael's, Inc. just paid $1.80 to its shareholders as the annual dividend. Simultaneously, the company announced that future dividends will be increasing by 4.00 percent. If you require a rate of return of 8.2 percent, how much are you willing to pay today to purchase one share of Michael's stock?

$44.57

$46.37

$15.34

$22.83

$22.29

 

Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $2.40 a share. The company has promised to maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn a 15.70 percent return on your equity investments?

$18.10

$15.29

$6.54

$13.30

$37.68

 

Shares of common stock of the Samson Co. offer an expected total return of 15.4 percent. The dividend is increasing at a constant 4.4 percent per year. The dividend yield must be:

3.50 percent.

15.40 percent.

11.00 percent.

19.80 percent.

4.40 percent.

 

Weisbro and Sons common stock sells for $50 a share and pays an annual dividend that increases by 5.3 percent annually. The market rate of return on this stock is 9.30 percent. What is the amount of the last dividend paid by Weisbro and Sons?

$2.11

$1.90

$4.42

$2.52

$1.85

 

The Bell Weather Co. is a new firm in a rapidly growing industry. The company is planning on increasing its annual dividend by 18 percent a year for the next 4 years and then decreasing the growth rate to 6 percent per year. The company just paid its annual dividend in the amount of $3.20 per share. What is the current value of one share of this stock if the required rate of return is 8.70 percent?

$190.24

$193.44

$174.46

$243.57

$246.77

 

NU YU announced today that it will begin paying annual dividends. The first dividend will be paid next year in the amount of $0.63 a share. The following dividends will be $0.68, $0.83, and $1.13 a share annually for the following three years, respectively. After that, dividends are projected to increase by 4.1 percent per year. How much are you willing to pay today to buy one share of this stock if your desired rate of return is 15 percent?

$11.23

$10.79

$11.42

$8.42

$2.11

 

Railway Cabooses just paid its annual dividend of $4.70 per share. The company has been reducing the dividends by 12.8 percent each year. How much are you willing to pay today to purchase stock in this company if your required rate of return is 15 percent?

$36.72

$19.07

$14.93

$20.00

$14.74