Universidad Ana G.

Méndez

Escuela de Estudios Profesionales

Programa Ahora

Cupey

Tarea Taller 3

Cristian González López

FINA 503

CRN 16552 Sección 900

Profesor Hamilton Cruz

 EXERCISES
(See process in the next page)

1) For 2022, Treasury bonds with 5-year maturities offered a return of about
6.5%; face value of $1,200; and 7.25% coupon rate. What would the
present value of this bond be?

- The Present value of this bond be $1,218.72 when $18.72 is prima

(rb > rm => Prima)

2) In 2005, ABC Company bought a bond with a face value of $7,500, 5.75%
coupon rate and 20 years of maturity. After 7 years, ABC Company wants
to know the present value of the bond, while the same bond is offered at
6.30% by Treasury. Determine the ABC Company’s bond value at the
time.

- The ABC Company’s bond value at the time is $7,124.10 when -

$375.90 is a discount. (-$375.90 < - - - - - Discount)

3) For a common stock from T&Y Cleaning, the actual price is $62.25 and
12% of rate of return. At the end of the year, T&Y Cleaning understands
that they will pay dividend for $2.45 per common stock. Calculate the price
at the end of the year.

- The price at the of the year be $67.27

4) Simon bought a common stock from Monona Air Cleaners Inc. at $35 per
share for January 5, 2020 and he expected for the price per share to
increase by $8 for December 31, 2020. If Monona Air Cleaners will pay
$1.75 for dividend per share, what would the expected rate of return of
Simon’s shares be?

- The expected rate of return of Simon’s shares after 7 years be

0.72%