exam2a.ch5partialch5Ach6ch7ch8 - Name Peoplesoft Number...

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Name __________________________________ Peoplesoft Number __________________________________ University of Houston C. T. Bauer College of Business Finance 3332 Fall, 2010 Exam 2A To receive full credit: Show all work—equations in variable form & equations with numbers plugged in, unless instructed differently Clearly indicate your (one) answer Calculator financial function inputs must be shown. All inputs to find annuity factor must be shown Carry all decimals, rounding only final answer Decimal places should be rounded to 4 places (2 in percent form) Currency answers rounded to the nearest cent, where applicable Include applicable units ($, %, etc.) on answers Point values are in parentheses. 1.  What is the  yield  to maturity of a  7 percent  annual  coupon  bond  with 15  years  to maturity if the  bond’s  market   is $914.40?  (6) 2.   Your  favorite  stock’s  current  annual  dividend  is $0.80  per  share.  Over  the  coming  two years,  earnings  and  di   are  expe cted  to grow  at an  annual  rate  of 14  percent,  then  growth  is expected  to slow  to a  constant  rate  of 8 per   thereafter.  What is the  value  of the  stock  to an  investor  who  requires  a  10  percent  rate  of return?  (8) 3.   Circle the  correct  respons e.  (2)  A twelve  year,  4 percent  coupon  bond,  with a  par  value  of $1000  sells  at $100   This  bond  is said  to be  selling  at: par a  premium a  discount 4.  Given  the  following  return  information  for Camille  Corporation,  determine  the  stock’s  standard  deviation  of ret   assu ming  the  expected  return  is 6%.  (6) Year Return 2009 - 10% 2008 12% 2007 14% 2006 8% 5.  Pleas e  ignore  the  problem  statem ent  on  the  exam;  we  did  not cover  that problem  type.  The  problem  should  ha   follows.  If Val invests  $15,000,  how  much  will he  have  in 10  years  if his  investm ent  earns  8 percent,  compound ed  contin   (4)
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6.  What is the  effective  rate  of interest  for 20  percent  compound e d  quarterly?  (6)
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exam2a.ch5partialch5Ach6ch7ch8 - Name Peoplesoft Number...

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