Please answer all questions ASAP

Question $30/7$ points

Calculate the current price of a $$1,000$ par value bond that has a

coupon rate of $9$ percent, pays coupon interest annually, has $29$

years remaining to maturity, and has a current yield to maturity

$($discount rate$)$ of $10$ percent. $($Round your answer to $2$ decimal

places and record without dollar sign or commas$).$

Answer:

$879\mathrm{.}41$ Incorrect Response $(906\mathrm{.}30)$

Hide question $3$ feedback

This is a simple bond valuation problem. On your financial calculator, FV $=$ par value; N $=$ number of years remaining to maturity; PMT $=($coupon rate$)($par value$)$; I$/$Y $=$ Yield to maturity; CPT PV$.$

Question $40/7$ points

Calculate the current price of a $$1,000$ par value bond that has a coupon rate of $14$ percent, pays coupon interest annually, has $21$ years remaining to maturity, and has a current yield to maturity $($discount rate$)$ of $9$ percent. $($Round your answer to $2$ decimal places and record without dollar sign or commas$).$

Answer:

$1,442\mathrm{.}61$ Incorrect Response $(1,464\mathrm{.}61)$

Question $57/7$ points

Compute the price of a $ $4,971$ par value, $18$ percent coupon consol, or perpetual bond $($i$.$e$.,$ coupon interest payment is a perpetuity$),$ assuming that the yield to maturity on the bond is $8$ percent. $($Round your answer to $2$ decimal places and record without dollar sign or commas$).$

Answer:

$11,184\mathrm{.}75$

Question $60/7$ points

Compute the price of a $$1,000$ par value, $9$ percent $($semi$-$annual

payment$)$ coupon bond with $19$ years remaining until maturity

assuming that the bond's yield to maturity is $17$ percent? $($Round

your answer to $2$ decimal places and record your answer without

dollar sign or commas$).$

Answer:

$413\mathrm{.}79$ Incorrect Response $(550\mathrm{.}61)$

Hide question $6$ feedback

Same as the last problem except let PMT $=($coupon rate$)($par value$)/2$ and let I$/$Y $=($Yield to Maturity$)/2$ and let N $=($Number of years to maturity$)(2).$

Question $70/7$ points

Pharsalus Inc. just paid a dividend $($i$.$e$.,$ D$0)$ of $ $4\mathrm{.}00$ per share. This dividend is expected to grow at a rate of $7\mathrm{.}1$ percent per year forever. The appropriate discount rate for Pharsalus's stock is $13\mathrm{.}7$ percent. What is the price of the stock? $($Round your answer to $2$ decimal places and record your answer without dollar sign or commas$).$

Answer:

$68\mathrm{.}48$ Incorrect Response $(64\mathrm{.}91)$

Hide question $7$ feedback

$($D$0*(1+$g$))/($ks $-$ g$).$ The most common mistake is to fail to grow the initial dividend.

Question $80/7$ points

The stock of Robotic Atlanta Inc. is trading at $ $33\mathrm{.}20$ per share. In the past, the firm has paid a constant dividend $($i$.$e$.,$ g $=0)$ of $ $4\mathrm{.}00$ per share and it has just paid an annual dividend $($i$.$e$.,$ D$0=4\mathrm{.}00).$ However, the company will announce today new investments that the market did not know about. It is expected that with these new investments, the dividends will grow at $9\mathrm{.}9\%$ forever. Assuming that the discount rate remains the same, what will be the price of the stock after the announcement? $($Round your answer to $2$ decimal places and record your answer without dollar sign or commas$).$

Answer:

$48\mathrm{.}40$ Incorrect Response $(204\mathrm{.}64)$

Hide question $8$ feedback

Step $1,$ Since this is currently a $0\%$ growth stock, divide D$0$ by P$0$ to get the required return. Step $2,$ calculate the new dividend with growth. Step $3,$ use D$1/($ks$-$g$)$ to get the new price.