Bond value does the repayment of the principle represent

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1. Countless Corp. is expected to pay an annual dividend of $4.75 on its common stock in one year. The current stock price is $75.15 per share. The company announced that it will increase its dividend by 3.85 percent annually. What is the company's cost of equity? Please show work.

2. Barry's Steriod Company has 1,000 par value bonds outstanding at 16 percent interest. The bonds will mature in 40 years. If the percent yield to maturity is 13 percent, what percent of the total bond value does the repayment of the principle represent.

Reference no: EM132058769

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