Questions from Corporate Finance

Q: Suppose the returns on long-term corporate bonds and T-

Suppose the returns on long-term corporate bonds and T-bills are normally distributed. Based on the historical record, use the NORMDIST function in Excel® to answer the following questions: a. What is...

Q: Rework Problems 1 and 2 assuming the ending share price is $

Rework Problems 1 and 2 assuming the ending share price is $61. Problem 2: In Problem 1, what was the dividend yield? The capital gains yield? Problem 1: Suppose a stock had an initial price of $74...

Q: Suppose you bought a bond with an annual coupon of 6 percent

Suppose you bought a bond with an annual coupon of 6 percent one year ago for $1,010. The bond sells for $1,025 today. a. Assuming a $1,000 face value, what was your total dollar return on this invest...

Q: Locate the Treasury bond in Figure 7.5 maturing in November

Locate the Treasury bond in Figure 7.5 maturing in November 2026. Is this a premium or a discount bond? What is its current yield? What is its yield to maturity? What is the bid-ask spread in dollars?...

Q: What was the average annual return on large-company stocks from

What was the average annual return on large-company stocks from 1926 through 2019: a. In nominal terms? b. In real terms?

Q: Using the following returns, calculate the arithmetic average returns, the

Using the following returns, calculate the arithmetic average returns, the variances, and the standard deviations for X and Y.

Q: You’ve observed the following returns on Pine Computer’s stock over the past

You’ve observed the following returns on Pine Computer’s stock over the past five years: 8 percent, −12 percent, 14 percent, 21 percent, and 16 percent. a. What was the arithmetic average return on th...

Q: Ashburn Corp. issued 25-year bonds two years ago at

Ashburn Corp. issued 25-year bonds two years ago at a coupon rate of 5.6 percent. The bonds make semiannual payments. If these bonds currently sell for 97 percent of par value, what is the YTM?

Q: Yan Yan Corp. has a $2,000 par value

Yan Yan Corp. has a $2,000 par value bond outstanding with a coupon rate of 4.7 percent paid semiannually and 13 years to maturity. The yield to maturity of the bond is 5.05 percent. What is the dolla...

Q: The RLX Co. just paid a dividend of $3.

The RLX Co. just paid a dividend of $3.20 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year indefinitely. If investors require a return of 10.5 percen...