FIN 571 TUTOR Education is Power/fin571tutor.com FIN 571 TUTOR Education is Power/fin571tutor.com | Page 43

Q-2 ( Set 2 )
Union Local School District has bonds outstanding with a coupon rate of 3.7 percent paid semiannually and 15 years to maturity . The yield to maturity on these bonds is 4.3 percent and the bonds have a par value of $ 5,000 . What is the dollar price of the bond ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .) Q-3 ( Set 1 )
Yan Yan Corp . has a $ 2,000 par value bond outstanding with a coupon rate of 5.5 percent paid semiannually and 16 years to maturity . The yield to maturity of the bond is 5.8 percent . What is the dollar price of the bond ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .) Q-3 ( Set 2 ) A Japanese company has a bond outstanding that sells for 90 percent of its ¥ 100,000 par value . The bond has a coupon rate of 5.7 percent paid annually and matures in 19 years . What is the yield to maturity of this bond ? ( Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places , e . g ., 32.16 .) Q-4 ( Set 1 ) The next dividend payment by ECY , Inc ., will be $ 1.96 per share . The dividends are anticipated to maintain a growth rate of 4 percent , forever . The stock currently sells for $ 39 per share . What is the dividend yield ? ( Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places , e . g ., 32.16 .) Dividend yield % What is the expected capital gains yield ? ( Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places , e . g ., 32.16 .) Capital gains yield % Q-4 ( Set 2 ) 4 . Schiller Corporation will pay a $ 3.14 per share dividend next year . The company pledges to increase its dividend by 5 percent per year , indefinitely . If you require a return of 12 percent on your investment , how much will you pay for the company ’ s stock today ? ( Do not round intermediate calculations and round your answer to 2 decimal places , e . g ., 32.16 .)