A1. Find the price today

A1. Find the price today

A1. Find the price today of a bond that has a 10 year life, 8.5% yield-to-maturity, and a 10% coupon.2. For the bond above, solve for the YTM if the bond sells for $974 today.3. Find the price today of a stock that is expected to pay a $2 dividend next year. Dividends are expected to grow at 4% for three years, then at 2.75 % for four years, and then 2% forever. The required return on the stock is 10%.

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