Use the bond's terms below to answer the question. Maturity 5 years Coupon Rate 3% Face value $1,000 Annual Coupons YTM 5% 1. Assuming the YTM remains constant throughout the bond's life, what is the bond's current yield between periods 3 and 4?

2. All else equal, if a company takes actions that make its dividends safer, then according to the Gordon model, you would expect its stock price to ________ because the _________ Group of answer choices Increase; the dividends will grow faster Increase; discount rate will decrease. Decrease; discount rate will decrease. Decrease; the dividends will grow faster

3. If investors expect inflation in the future to be higher Group of answer choices Nominal interest rates will fall because the demand for bonds will increase. Nominal interest rates will rise because the demand for bonds will decrease. Nominal interest rates will fall because the demand for bonds will decrease. Nominal interest rates will rise because the demand for bonds will increase.

4. In the event a firm goes bankrupt, which of the following is true? Fill-in the blanks

get paid first. __________get paid second. ____________ get paid last.

Group of answer choices

Common stockholders; Bond holders; Preferred stockholders

Preferred stockholders; Common stockholders; Bond holders

Bond holders; Preferred stockholders; Common stockholders

Bond holders; Common stockholders; Preferred stockholders