can someone give me the formula for question #1 and #2 In this part of the assig
ID: 2772010 • Letter: C
Question
can someone give me the formula for question #1 and #2
In this part of the assignment, you will:
Determine the value of stocks: preferred and common.
Estimate the value of stock with high growth, and then estimate the value of stock with constant growth.
Determine the components of stock valuation models.
Determine the value of bonds paying annual and semiannual interest payments, and determine the yield to maturity of bonds paying annual and semiannual interest payments
Bonds 1. Bond. What is the value of a $1,000 par value bond with annual payments of an a. 10% coupon with a maturity of 10 years and a 15% required return? $749.06 b. 8% coupon with a maturity of 10 years and a 8% required return? $1,000.00 c. 11% semiannual coupon with a maturity of 20 years and a 11% required return? $1,000.00 d. 8% semiannual coupon with a maturity of 20 years and a 9% required return? $907.99 2. Bond. What is the yield to maturity of a $1000 par value bond with an a. 10% annual coupon and 10 years to maturity and a $1,000 price? 10% b. 9.5% annual coupon and 20 years to maturity and a $788 price? 12.41% c. 5.0% annual coupon and 8 years to maturity and a $800 price? 8.55%Explanation / Answer
1.
a)
= $100×[1-(1÷(1+15%)^10))]÷15%+$1000×(1÷(1+15%)^10)
= $749.06
b)
= $80×[1-(1÷(1+8%)^10))]÷8%+$1000×(1÷(1+8%)^10)
= $1,000
c)
= $110×[1-(1÷(1+11%)^20))]÷11%+$1000×(1÷(1+11%)^20)
= $1,000
d)
= $40×[1-(1÷(1+4.5%)^40))]÷4.5%+$1000×(1÷(1+4.5%)^40)
= $907.99
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