1) Jane is 25 years old and was able to save $25,000. After doing some research, she identifies a stock called HPG Industries that has a dividend yield of 7% that has been consistent for the past 10 years. Based on this information, she decides to invest in this stock. Considering that HPG Industries pays the dividend consistently, how many years will it take for Jane to double her money?

1) Jane is 25 years old and was able to save $25,000. After doing some research, she identifies a stock called HPG Industries that has a dividend yield of 7% that has been consistent for the past 10 years. Based on this information, she decides to invest in this stock. Considering that HPG Industries pays the dividend consistently, how many years will it take for Jane to double her money?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Kwaku Appiah has been working for a textile manufacturing company for the past 25 years. At his present age of 50, he decided to go into the business of buying and selling as the future looks bleak for him. He provides you with the following information: 1. His savings over the 25 years was shares in a listed company at a cost of GHC5,000 whose present market value is GHC4,200. This has to be realized for the purpose of his intended business. 2. Kwaku was promised sales orders amounting to GHC54,000 and GHC90,000 respectively for the first two quarters of 2019. From July onwards, sales are expected to be steady at the rate of GHC150,000 per quarter. 3. He will maintain inventory of goods costing GHC40,000 which have to be delivered in December 2018 if the business is to start in January 2019. 4. The goods will be sold, on average, at a gross profit margin of 20%. 5. A delivery van will be purchased and paid for in January 2019 for GH12,000. It is expected to last for 5 years and be…
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After graduating from Baruch, Amal plans on investing $8,000 every year beginning age 25 to age 65 (40 years). She plans on buying a Total US Stock Market Index fund and expects it will earn a “gross” 10% a year – in line with the historic return from US stocks. How much would her portfolio be worth at age 65 if her expense ratios was 0.05% Ans:
Samuel just purchased one IBM stock share for 7 dollars. IBM stock price has a 20% chance to be 3, a 30% chance to be 19, and a 50% chance to be 7 next year. What is Samuel's expected return (report the return as a decimal number with four decimal places such as 0.0665) from holding the IBM share for one year?
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