What is the value of a bond that matures

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Reference no: EM131317086

1. What is the value of a bond that matures in 60 years, has an annual coupon rate of $60, and a par value of $1,000? Assume a required rate of return of 12%, and round your answer to the nearest $10.

a) $410

b) $490

c) $500

d) $520

2. Cowtown Cellular bonds mature in 1 1/2 years with a face value of $1,000. They pay a coupon rate of 12% distributed semi-annually. If the required rate of return on these bonds is 14% what is the bond's value?

a) $1,026.73

b) $973.76

c) $1,022.74

d) $814.26

3. Moo Moo Land Dairy Co. has net income of $450,000 this year. The book value of MML common stock is $3 million dollars. The company's dividend payout ratio is 60% and is expected to remain this way. What is Moo Moo Land Dairy's sustainable growth rate?

a) 3%

b) 9%

c) 6%

d) 10%

Reference no: EM131317086

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