1. A bond has a face value of 10000 and a coupon rate of 6% with an original maturity of 10 years with six years to maturity left. If yields on bonds of similar risk are expected to be 6.6% in two years what will the value of the bond be then?

A 9652.22

B 9675.25

C 9671.25

D 9828.71

2. This morning, you purchased a stock that will pay an annual dividend of $1.90 per share next year. You require a 11.73 percent rate of return and the annual dividend increases at 3.5 percent annually. What will your capital gain be on this stock if you sell it three years from now?

$2.92

$2.87

$2.51

$2.43

$2.63