Answer the following questions:

1. Coupon rates: Kiss the Sky Enterprises has bonds on the market making annual payments, with 13 years to maturity, and selling for $1045. At this price, the bonds yield 7.5 percent. What must the coupon rate be on the bonds?

2. Bond prices: Grohl Co. issued 11 year bonds a year ago at a coupon rate of 6.9 percent. The bonds make semiannual payments. If the YTM on these bonds is 7.4 percent, what is the current bond price?

3. Bond yields: N corp. issued 12 year bonds 2 years ago at a coupon rate of 8.4 percent. The bonds make semiannual payments. If these bonds currently sell for 105 percent of par value, what is the YTM?

4. Nominal and real returns: An investment offers a 14 percent total return over the coming year. Bill Bernanke thinks the total real return on this investment will be only 9 percent. What does Bill believe the inflation rate will be over the next year?

5. Stock valuation: Keenan Co. is expected to maintain a constant 5.2 percent growth rate in its dividends indefinitely. If the company has a dividend yield of 6.3 percent, what is the required return on the companyâ€™s stock?

6. Nonconstant dividends: Bread, Inc. has an odd dividend policy. The company just paid a dividend of $6 per share and has announced that it will increase the dividend by $4 per share for each of the next five years, and then never pay another dividend. If you require an 11 percent return on the companyâ€™s stock, how much will you pay for a share today?

7. Two-stage dividend growth model: Thirsty Cactus corp. just paid a dividend of $1.25 per share. The dividends are expected to grow at 28 percent for the next eight years and then level off to a 6 percent growth rate indefinitely. If the required return is 13 percent, what is the price of the stock today?

Answer the following questions: 1. Coupon rates: Kiss the Sky En...