**Each question must be APA format 250 word minimum.**

** **

** **

**Question 1 **

Valuation – zero-coupon bond

A U.S. Government bond with a face amount of $10,000 with 8 years to maturity is yielding 3.5%. What is the current selling price?

**Question 2 **

Valuation – corporate bond

A $1,000 corporate bond with 10 years to maturity pays a coupon of 8% (semi-annual) and the market required rate of return is a) 7.2% and b) 10%. What is the current selling price for a) and b)?

**Question 3 **

Valuation - preferred stock

What is the value of a share of preferred stock that pays a $4.50 dividend, assume k is 10%.

**Question 4 **

Valuation - preferred stock

What is the value of a share of preferred stock that pays a $9.50 dividend, assume k is 12%.

**Question 5 **

Charlie Company is expected to grow at an annual rate of 6% indefinitely. The return on similar stocks is currently 11%. Charlie's board of directors declared a dividend of $1.85 yesterday. What should a share of Charlie Company sell for?

All work must be referenced to this textbook:

Lasher, W. R. (2011). *Practical financial management.* Mason, OH. South-Western Cengage Learning.

Subject | Business |

Due By (Pacific Time) | 08/25/2013 04:00 pm |

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