Question: 7 (10 points). Compute the value of a two year, 6.0% annual coupon bond, if the discount rate (YTM) = 10% with the par value

7 (10 points). Compute the value of a two year, 6.0% annual coupon bond, if the discount rate (YTM) = 10% with the par value of $1,000. 8 (10 points). Compute the value of common stock: Upotonic.com. The company is expected to pay its dividends in a pattern provided below. Notice that the beta of this stock (Bup) = 0.5, TRF = 2%, and I'market = 8% Do = $1.00 D1 = $1.05 (this dividend payment pattern continues.) D2= $1.1025 51 Page

7(10 points). Compute the value of a two year, 6.0% annual coupon bond, if the discount rate (YTM)=10% with the par value of $1,000. 8 (10 points). Compute the value of common stock: Upotonic.com. The company is expected to pay its dividends in a pattern provided below. Notice that the beta of this stock (v)=0.5, no =2%, and tmarhet=8%

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