What is return shareholders are expecting

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Reference no: EM131902341

1. Primary dealers believe inflation will average 5% over the next ten years. They are looking for a real rate of 2% per year. If the Treasury auctions a 6% coupon bond, will the bond trade at a premium, discount or par?

2. Expected Return Circuit City Stores (CC) recently paid a $.35 dividend. The dividend is expected to grow at a 24.90 percent rate. At the current stock price of $9.86, what is the return shareholders are expecting?

Reference no: EM131902341

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