David has one share of stock and one bond. The total value of the two securities is
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David has one share of stock and one bond. The total value of the two securities is $1,051.80. The bond has a YTM of 12.75 percent, a coupon rate of 8.06 percent, and a face value of $1,000.00; pays semi-annual coupons with the next one expected in 6 months, and matures in 3 years. The stock pays annual dividends that are expected to grow by 4.34 percent per year forever. The next dividend is expected to be $12.45 and paid in one year. What is the expected return for the stock?
Related Book For
Investment Analysis and Portfolio Management
ISBN: 978-0538482387
10th Edition
Authors: Frank K. Reilly, Keith C. Brown
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