Generally a firm will pay dividends based on a pattern - zero growth, constant growth, and differential (non constant) growth. How would a stock be valued - regardless of dividend pattern? What is a constant growth stock? How are constant growth stocks valued? And describe how you could estimate their values. If you are investing in the stock market, which would you invest in and

Select a stock in which you are interested. Calculate its per share value using the DDM or another method. Then, find the current market value of a share of the stock. Compare the two and explain the similarity or difference?

Do some research, probably on the Web, and find some bonds with differing yields to maturity (YTM). How do you explain the difference? Both the lecture and the textbook discuss some factors that may lead to this difference.