Chapter 7: Interest Rates and Bond Valuation 1) Simple Interest: If a bond has a par value of $1,000 and a coupon rat

Answer the following questions. (Show your work)

Chapter 7: Interest Rates and Bond Valuation

1) Simple Interest: If a bond has a par value of $1,000 and a coupon rate of 4.5%, then how much interest would the bondholder receive each year?

2) Taxable equivalent yield: If a municipal bond pays and interest rate of 3% and the investor is in a 35% tax bracket, then what is the taxable equivalent yield?

Chapter 8: Stock Valuation

1) Cash flow / Total return for stockholders: Compute the total return (dollar amount) based on the following: Shareholder buys 225 shares of stock for $17 per share. One year later the shareholder sells all shares for $25.50 per share. In addition the shareholder received a total of $1.25 dividend per share.

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 I uploaded the book in the uploaded file you can find it there you can use the book to find the answers. 

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use chapters 7 and 8 to find the answers, please