SECTION I1 Points assigned to each problem are duly noted. You must neatly show your work including all relevant formulas and fully document your answer with numbers to be eligible for full credit. This section consists of 13 problems for a combined total of 80 points. Problem 1. CIR, Inc. has a 16 percent coupon bond on the market with 10 years remaining until maturity. The bond makes semi-annual payments and the face value is S1,000. If investors require a 12 percent yield, what is the current bond price? (5 points) Problem 2. A bond with face value $1,000 has 14 years until maturity, a coupon rate of 8 percent, paid annually and a yield to maturity of 6 percent. yield? (5 points) What is its current Problem 3. Bonds issued by the Etling Corporation have a price of $790.55 and a coupon rate of 8 percent which is paid annually. The bonds will mature in 14 years and the face value is $1,000. What is the yield to maturity? (5 points) Problem 4. Stability Corporation's dividend is expected to be $1.60 next year. stock price is $40 per share. The company is a constant growth firm. If investors require a return of 12 percent on this stock, what do they think Stability's growth rate will be? (5 points) Its current Plug and Play Inc. is in a declining industry at a rate of 14 percent per year indefinitely. If the discount rate is 8 percent and a $3.20 per share dividend are just paid, what price do you forecast for the stock next year? (5 points) Problem 5