CIS 490 Online Fall 2014Written Homework#3
1. For the function: y = f(x) = 2×2 – x + 2, find the value of y for x = -1, -.5, 0, .25, .5, 1, 1.5. Plot the points on the graph below and draw the curve.
What is the name of this curve?
2. For the parabola: y = f(x) = 1 – x2, graph the function for x between -1 and 1.
3. For the parabola y = x2 – 6x +5 use the quadratic formula to find the values for x that give y = 0.
4. Graph the functions y=x2, y=x3, y=x4 on the graph below. For example find the values of each function for x = 0, 1, 2, 3, 4.
Which of the curves rises the fastest?
5. Consider the graph below:
6. With a calculator find v0, v1,v2,v3,v4,v5, v9,v11,v16.
7. With a calculator find 2^(5/2), ?2=2^(1/3), ?27, ?1331.
8. With a calculator find the values of the functions: y=e^x, and z=ln?(x),
for x = .2, .5, 1, 2, 2.5.
9. Find 7!.
1. A $1,000 corporate bond with 20 years to maturity pays a coupon of 7% (semi-annual) and the market required rate of return is a) 6.6% b) 13%. What is the current selling price for a) and b)?
2. What is the value of a share of preferred stock that pays a $9.50 dividend, assume k is 12%.
3. You purchased one of AAA Corp.’s 9%, 15-year convertible bonds at its $1,000 par value a year ago when the company’s common stock was selling for $25. Similar bonds without a conversion feature returned 10% at the time. The bond is convertible into stock at a price of $35. The stock is now selling for $40.
Assume no dividends.
a) You exercise the conversion feature today and immediately sold the stock you received. Calculate the total return on your investment.
b) What would your return have been if you had invested $1,000 in AAA’s stock instead of the bond?
4. The following information refers to a six-month call option on the stock of XYZ, Inc.
Price of the underlying stock: $50
Strike price of the three-month call: $45
Market price of the option: $10
a) What is the intrinsic value of the option?
b) What is the option’s time premium at this price?
5. A share of stock is currently selling for $31.80. If the anticipated constant growth rate for dividends is 6% and investors are seeking a 16% return, what is the dividend just paid?