What is the stock expected price one years from today

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Reference no: EM132012187

1. A tax exempt bond was issued at a 10% coupon bond and a maturity of 15 years. The Par Value of the bond is $1000.

At what required market rate (10%, 5% or 14%) does the above bond sell at a discount? At a premium?

2. A stock is expected to pay a dividend of $2.75 at the end of the year (i.e., D1 = $2.75), and it should continue to grow at a constant rate of 4% a year. If its required return is 12%, what is the stock's expected price 1 years from today? Round your answer to two decimal places. Do not round your intermediate calculations.

Reference no: EM132012187

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