The clean price of bond is different from actual cash price

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Reference no: EM131323972

1. Into Eternity Co. plans to pay a dividend of $3 per share next year. If the expected long-run growth rate of the dividends is 5% per year and the required rate of return is 11%, what is the stock price per share today?

2. Which of the following statements is most FALSE?

A.The “clean price” of a bond is different from the actual cash price.

B. Investment grade bonds are bonds rated at least BB by S&P or Ba by Moody’s.

C. All else equal, a callable bond would have a higher required return than a non-callable bond.

D. Market expectations of interest rates affect the shape of the yield curve.

Reference no: EM131323972

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