1. What is the average annualized compounded return of a stock given the information below:

Stock Price on 02/01/2014 = 22.67 per share

Stock Price on 04/30/2014 = 22.77 per share

Cash Dividend Received 03/30/2014 = .12 per share

a. 3.88%

b. 2.94%

c. 2.91%

d. 3.94%

2. Suppose a bank has found bank-qualified municipal bonds which have a nominal gross rate of return of 8 percent and that it can borrow funds needed for this purchase at a rate of 6.25 percent. The bank is in the 35 percent tax bracket. What is the net after-tax return on this bond?

A. 5.20 percent

B. 3.5 percent

C. 1.75 percent

D. 0 percent

E. None of the options is correct