You got a high-paying job as a security analyst for a hedge fund. Your employer wants your opinion about XWZ common stock which currently sells for...

1. You got a high-paying job as a security analyst for a hedge fund. Your employer wants your opinion about XWZ common stock which currently sells for $92.50 per share and which recently paid a dividend of $3.94 per share. Over the last ten-years dividends per share have grown steadily at an annual rate of 5.11%. You believe that they will continue to grow at the same rate for the indefinite future. If he requires a rate of return of 12.5%, you will tell him that,

the stock is overpriced, and that he should not pay more than $69.76

the stock is overpriced, and that he should not pay more than $89.76

the stock is underpriced, and that it should be selling for $99.76

the stock is underpriced, and that it should be selling for $95.76

the stock is overpriced, and that he should not pay more than $56.04.

1. What would be the monthly payments if you amortize the above loan in 15 years?

$1,742.21

1,677.33

1,761.11

1,833.09

1,599.98

1. How much would you have saved if you amortized the loan in 15 years instead of 30 years?

$141,492

131,488

121,567

151,732

149,001

1. What is the highest price any one should pay today for a 20-year, $1,000 face value bond that pays $56 in interest at the end of each year, if the current market rate of interest is 4%?

$1,100

1,217.45

1,321.12

1,199.99

A professor bequeaths $100,000 to a college with the stipulation that it be placed in a trust and invested in common stocks for 100 years, at which point all of the funds are to be used for scholarships. How much will be available for scholarships, if the funds earn a 9.5% AC rate?

$848,806,835.63

797,613,671.26

873,799,753.01

833,421,345.17

789,030.617.0