Myriad Co. just paid a dividend of $ 3,98 per share out of earnings of $ 18,93 per share.

If the book value per share

DPS 3.98 Payout 21.0%

EPS 18.93 Plowback 79.0%
BVPS 59.34 ROE 31.9%
g 25.19%

Glasswhand Inc. book value per share is $ 109,5. The firm just paid a dividend of $ 7,2 per share out of earnings of

DPS 7.20 Payout 45.3%

EPS 15.90 Plowback 54.7%
BVPS 109.50 ROE 14.5%
g 7.95%

Calculate the price of a fixed income security that pays semiannual coupons, with a nominal coupon rate of 16% pe

Coupon 16.00% nominal a.a. Year Cash flow PV

YTM 14.00% a.a. 0.5 196.40 183.95
Principal 2,455.00 $ 1 196.40 172.28
1.5 196.40 161.36
2 2,651.40 2,040.17
Price 2,557.75

Thornbirned Co. issued a fixed income security that pays semiannual coupons, with a nominal coupon rate of 11,8%

Coupon 11.80% nominal a.a. Year Cash flow PV

YTM 13.30% a.a. 0.5 1,034.15 971.56
Principal 17,528.00 $ 1 1,034.15 912.76
1.5 1,034.15 857.51
2 1,034.15 805.61
2.5 1,034.15 756.85
3 18,562.15 12,762.58
Price 17,066.87

A National Treasury Bill (Letra do Tesouro Nacional - LTN) maturing in 125 business days is being traded at R$836. W

Maturity 125 business days

Price 836 R$

YTM 43.49% per year

An investor bought an LTN (Letra do Tesouro Nacional) that would mature in 176 business days. At the time of the

Maturity 176 business days Inicial pric 934.4151

Initial YTM 10.20% per year Selling pric 944.0069
 Sold after 16 business days
Selling YTM 9.50% per year Rate of ret 1.03%

The MajorBiggestTech Co. just paid a dividend of $ 1,3 per share. Analysts expect its dividend to grow at 21 percen

DPSo 1.3 $ Year Cash flow PV

g1 21.00% per year 1 1.57 1.39
g2 3.00% per year 2 1.90 1.48
Ke 13.40% per year 3 2.30 1.58
Perpetuity 2.37 15.64
Price 20.09

James B., a famous stock analyst, is valuing the price of the firm PayWhenUcan Inc that just paid a dividend of $ 6,4

DPSo 6.43 $ Year Cash flow PV

g1 36.00% per year 1 8.74 7.28
g2 9.00% per year 2 11.89 8.25
Ke 20.06% per year Perpetuity 12.96 81.31
Price 96.85

A major US exporter is concerned about the exchange rate risk. In December 2021, the exchange rate for the USDE

USDEUR 2.05 USD/EUR x

Inflation US 10.20%
Inflation EURO 2.00% Nominal exchange rate = Spot Exchange rate*(1+inflatio

Exchange rate 2.21 USD/EUR

The forward BRLUSD exchange rate for 1 year is 6,95 BRL/USD. If the US risk free rate is 5,6 % per year and the Bra

Forward 6.95 BRL/USD

US rate 5.60% per year Relação taxa BRL/USD c
BR rate 11.99% per year Spot Rate #VALUE!

Spot exchange 6.55 BRL/USD Taxa spot = taxaforward/((1+ interest rate BRL)/(1 + int
Taxa forward = taxa spot*(1+interest rate BRL)/(1+ inte
An investor has bought a fixed interest rate CDB paying an interest rate of 8,0% p.a.over with maturity on 51 work

Interest rate 8.80% p.a.

Inflation 5.50% p.a.

Real Rate 3.13% per year

An investment was made in a period of 3 months. The monthly inflation rates in this period were:
Month 01: 0,37% p.m. 
Month 02: 0,68% p.m. 
Month 03: 0,70% p.m. 
Find the annual inflation rate for this period.

Inflation 1 0.37% per month

Inflation 2 0.68% per month
Inflation 3 0.70% per month
Inflation 7.23% per year

A Tesouro IPCA+ government bond accrues a real interest rate of 4,85% p.a. plus the inflation rate as measured by

Real rate 4.85% per year

Inflation 0.27% per month
Period 8 months

Effective rate 5.46% per period

A 10-year maturity bond making annual coupon payments, has duration of 5,6 years. The bond currently sells at $

Duration 5.60 years

Price 1,418.00 $
YTM 9.73% per year
Change 1.92% per year

New Price 1,279.06 $

A coupon bond paying interest annually has a modified duration of 10,59 , sells for $ 738,19, and is priced at a yield

Modified Durat 10.59

Price 738.19 $
YTM 6.20% per year
New YTM 7.40% per year

Price Change -93.81 $

A fixed-rate Brazilian bond (LTN – Letra do Tesouro Nacional) is quoted today at 7,8 % (per year) and has 645 busin

YTM 1 7.80% per year PU1 825.11

n1 645 business days
YTM 2 4.50% per year PU2 914.13
n2 514 business days
Return 10.79% per period

Clearming Inc. just paid a dividend of $3 per share out of earnings of $5 per share. If its book value per share is $40

DPSo 3 $/share
 EPSo 5 $/share Payout ratio 60.00%
Book value 40 $/share Plowback ratio 40.00%
Price 52.5 $/share ROE 12.50%
g 5.00%
Ke 11.00%

Capmymind Co. pays out 60 percent of its earnings as dividends. Its return on equity is 15 percent. What is the stab

Payout ratio 60.00%

Plowback ratio 40.00%
ROE 15.00%
g 6.00%

The table below presents the maturity and rates (YTM) of Brazilian Federal Government Bonds as it was at 02/01/2

Yield
Bond Maturity
(p.a.)
NTN-F 7/1/2017 8.42%
NTN-F 1/1/2018 8.75%
NTN-F 7/1/2018 9.03%
NTN-F 1/1/2019 9.24% <===
NTN-F 7/1/2019 9.38%
NTN-F 1/1/2020 9.46%
NTN-F 7/1/2020 9.50%

The duration (in years) of the NTN-F with maturity in 01/01/19.

Coupo rate 10% per year 4.88% per semester

Date Year (t) Cash flow PV(YTM) PV(YTM).t

7/1/2017 0.50 48.81 46.70 23.35
1/1/2018 1.00 48.81 44.68 44.68
7/1/2018 1.50 48.81 42.75 64.12
1/1/2019 2.00 1048.81 878.89 1757.77

Duration 1.866 years

The table below presents the maturity and rates (YTM) of Brazilian Federal Government Bonds as it was at 02/01/2

Bond Maturity Yield

(p.a.)
NTN-F 7/1/2017 8.42%
NTN-F 1/1/2018 8.75%
NTN-F 7/1/2018 9.03%
NTN-F 1/1/2019 9.24%
NTN-F 7/1/2019 9.38% <===
NTN-F 1/1/2020 9.46%
NTN-F 7/1/2020 9.50%
The duration (in years) of the NTN-F with maturity in 01/07/19.

Coupo rate 10% per year 4.88% per semester

Date Year (t) Cash flow PV(YTM) PV(YTM).t

7/1/2017 0.50 48.81 46.67 23.33
1/1/2018 1.00 48.81 44.62 44.62
7/1/2018 1.50 48.81 42.67 64.00
1/1/2019 2.00 48.81 40.80 81.59
7/1/2019 2.50 1048.81 838.21 2095.52

Duration 2.280 years

The table below presents the maturity and rates (YTM) of Brazilian Federal Government Bonds as it was at 02/01/2

Bond Maturity Yield

(p.a.)
NTN-F 7/1/2017 8.42%
NTN-F 1/1/2018 8.75%
NTN-F 7/1/2018 9.03%
NTN-F 1/1/2019 9.24%
NTN-F 7/1/2019 9.38%
NTN-F 1/1/2020 9.46% <===
NTN-F 7/1/2020 9.50%

The duration (in years) of the NTN-F with maturity in 01/01/20.

Coupo rate 10% per year 4.88% per semester

Date Year (t) Cash flow PV(YTM) PV(YTM).t

7/1/2017 0.50 48.81 46.65 23.33
1/1/2018 1.00 48.81 44.59 44.59
7/1/2018 1.50 48.81 42.62 63.93
1/1/2019 2.00 48.81 40.74 81.47
7/1/2019 2.50 48.81 38.94 97.34
1/1/2020 3.00 1048.81 799.71 2399.12

Duration 2.674 years

The table below presents the maturity and rates (YTM) of Brazilian Federal Government Bonds as it was at 02/01/2

Yield
Bond Maturity
(p.a.)
NTN-F 7/1/2017 8.42%
NTN-F 1/1/2018 8.75%
NTN-F 7/1/2018 9.03%
NTN-F 1/1/2019 9.24%
 NTN-F 7/1/2019 9.38%
NTN-F 1/1/2020 9.46%
NTN-F 7/1/2020 9.50% <===

The duration (in years) of the NTN-F with maturity in 01/07/20.

Coupo rate 10% per year 4.88% per semester

Date Year (t) Cash flow PV(YTM) PV(YTM).t

7/1/2017 0.50 48.81 46.64 23.32
1/1/2018 1.00 48.81 44.57 44.57
7/1/2018 1.50 48.81 42.60 63.90
1/1/2019 2.00 48.81 40.71 81.41
7/1/2019 2.50 48.81 38.90 97.25
1/1/2020 3.00 48.81 37.18 111.53
7/1/2020 3.50 1048.81 763.39 2671.87

Duration 3.051 years

TESTES CONCEITUAIS
Which of the following bonds has the longest duration?

Answer: 10-year, zero-coupon bond

Which of the following bonds has the greatest volatility?

Answer: 8-year, zero-coupon bond

Which of the following statements about the relationship between interest rates and bond prices is true?

Answer: There is an inverse relationship between bond prices and interest rates, and the price of

As CFO of your corporation, you would prefer (all else equal) to see the price of your corporation's bonds

Answer: increase, indicating that bond investors view your firm as less risky.

Generally, high growth stocks pay

Answer: low or no dividends.

The constant dividend growth formula P0 = Div1/(r - g) assumes

Answer: that dividends grow at a constant rate g, forever, and r > g only.
One can estimate the expected rate of return or the cost of equity capital as

Answer: Dividend yield + expected rate of growth in dividends.

One can estimate the dividend growth rate for a stable firm as

Answer: plow-back rate × the return on equity (ROE).

ook value per share is $ 59,34, what is the expected growth rate in dividends?

out of earnings of $ 15,9 per share. What is the expected growth rate in dividends?

pon rate of 16% per year, follows the American Amortization System, has a face value of $ 2.455 and matures in 2 years. Consider an e

oupon rate of 11,8% per year, follows the American Amortization System, has a face value of $ 17.528 and matures in 3 years. The effe

traded at R$836. What is the annualized yield to maturity (YTM) for this bond?

At the time of the purchase, the spot interest rate for LTN maturity date was 10,2% per annum. Then, 16 business days after buying th
 in the period

grow at 21 percent per year for the next three years and then 3 percent per year thereafter. If the required rate of return on the stock

a dividend of $ 6,43 per share. James expects the firm 's dividend to grow at 36 percent per year for the next two years and then 9 pe

e rate for the USDEUR was USD {b} = EUR 1. Inflation for the next year was estimated {ib} % in USA and {iu} % in the Euro zone. If purch

nge rate*(1+inflation USD)/(1+ inflation EUR)

er year and the Brazilian risk free rate is 11,99 % per year, what is the current spot BRLUSD exchange rate?

t rate BRL)/(1 + interest rate USD))

rate BRL)/(1+ interest rate USD)
aturity on 51 working days. Knowing that a tax rate of 5,5% will be charged on the return of the investment, and that the number of w
te as measured by IPCA. Suppose the interest rates will remain the same, that the investment was made for a period of 8 months and

currently sells at $ 1.418 and yield to maturity of 9,73 % per year. What is the approximate price of this bond if its yield to maturity cha

d is priced at a yield to maturity of 6,2 % per year. If the YTM increases to 7,4 %, what is the predicted change in price? (pay attention t

and has 645 business days to maturity. After some period, the same bond is quoted at 4,5 % and has 514 business days to maturity. W

er period

ue per share is $40.00 and its market price is $52.50 per share, calculate the required rate of return on the stock.
nt. What is the stable dividend growth rate for the firm?

as it was at 02/01/2017 (in annual terms). NTN-F are prefixed bonds with semiannual coupon payments and a coupon rate of 10,0% pe

as it was at 02/01/2017 (in annual terms). NTN-F are prefixed bonds with semiannual coupon payments and a coupon rate of 10,0% pe
as it was at 02/01/2017 (in annual terms). NTN-F are prefixed bonds with semiannual coupon payments and a coupon rate of 10,0% pe

as it was at 02/01/2017 (in annual terms). NTN-F are prefixed bonds with semiannual coupon payments and a coupon rate of 10,0% pe
es is true?

s, and the price of long-term bonds fluctuates more than the price of short-term bonds for a given change in interest rates (assuming t

n's bonds
es in 2 years. Consider an effective ETTJ flat of 14% per year over the entire life of the fixed income security.

atures in 3 years. The effective ETTJ is flat of 13,3% per year over the entire life of the fixed income security. Calculate the price of the

siness days after buying the LTN, he decided to sell it. At the time of the sale, the spot rate for the LTN maturity date was 9,5% per ann
rate of return on the stock is 13,4 percent, what is the current value of the stock?

t two years and then 9 percent per year forever. If the required rate of return on the stock is 20,06 percent, what is the current value

% in the Euro zone. If purchasing power parity held, what should have been the USDEUR nominal exchange rate in December 2022?

and that the number of working days on an year is 252, calculate the real ANNUAL over interest rate of this investment.
a period of 8 months and the monthly inflation rate for the period was 0,27% p.m., calculate the effective (or nominal) interest rate fo

if its yield to maturity changes 1,92 % per year?

e in price? (pay attention to the sign of the predicted change when you type the answer)

siness days to maturity. What is the return (% per period) for an investor that buys the bond today and resells it after some period?
a coupon rate of 10,0% per annum. Make all calculations considering that all semesters have the same timespan. Please calculate:

a coupon rate of 10,0% per annum. Make all calculations considering that all semesters have the same timespan. Please calculate:
a coupon rate of 10,0% per annum. Make all calculations considering that all semesters have the same timespan. Please calculate:

a coupon rate of 10,0% per annum. Make all calculations considering that all semesters have the same timespan. Please calculate:
interest rates (assuming that the coupon rate is the same for both).
culate the price of the fixed income security issued by Thornbirned Co.

date was 9,5% per annum. What was the investor's rate of return in the period? (disregard taxes and transaction costs).
at is the current value of the stock?

n December 2022?

stment.
ominal) interest rate for a period of 8 months.

after some period?

. Please calculate:

. Please calculate:
. Please calculate:

. Please calculate: