1. Using the Appendices in the text, what is the Market Value today of a bond with a PAR value of $5,000, with 9% annual coupon payments, with a YTM of 5% and 20 years to maturity?

2. What is the price of one share of preferred stock with a dividend of $8 and a rate of return of 6%?

3. Butter Corp. has a P/E of 16x. If EPS is $3.28, what is the price of one share of Butter Corp. common stock?

4. Given the following information, calculate the WACC.

Capital Structure: Debt = 40%

Pref. Stock = 20%

Common St = 40%

Additional Information:

Corporate Tax rate = 25%

Preferred Dividend = $8.50

Expected Common Dividend = $2.50

Preferred Price = $105.00

Growth Rate = 7%

Bond Yield = 9.5%

Preferred Floatation Cost = $3.60

Common Stock Price = $75.00