2. V Investments: High Dividend Stocks During the first quarter of 2015, Plains All American Pipeline L.P. (PAA) stock cost $50 per share and was expected to yield 5% per year in dividends, while Total SA (TOT) stock cost $50 per share and was expected to yield 6% per year in dividends." If you invested a total of $45,000 in these stocks and expected to earn $2,400 in dividends in a year, how many shares of each stock did you purchase?

2. V Investments: High Dividend Stocks During the first quarter of 2015, Plains All American Pipeline L.P. (PAA) stock cost $50 per share and was expected to yield 5% per year in dividends, while Total SA (TOT) stock cost $50 per share and was expected to yield 6% per year in dividends." If you invested a total of $45,000 in these stocks and expected to earn $2,400 in dividends in a year, how many shares of each stock did you purchase?

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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Shamas Famous Restaurants expects to pay a common stock dividend of $1.50 per share next year (d1). Dividends are expected to grow at a 4% rate for the foreseeable future. Shamas’ common stock is selling for $18.50 per share, and issuance costs are $3.50 per share. What is Shamas cost of external equity? 12.11% 20.59% 10.00% 14.00%
A firm recently paid a dividend of $1.75 per share. The dividend is expected to grow by 13% for the next 2 years. The dividend is expected to grow by a more modest 3.50% thereafter. What is the firm's stock value per share given a 6.95% discount rate? $58.61 ○ $62.41 $21.47 ○ $70.84
Glenna Gayle common stock sells for $55, and dividends paid last year were $1.35. Flotation costs on issuing stock will be $4.40. The dividends are predicted to have a 10% growth rate. What is the cost of internal equity for Glenna Gayle?
(Related to Checkpoint 10.1) (Common stock valuation) Header Motor, Inc., paid a $3.52 dividend last year. At a constant growth rate of 6 percent, what is the value of the common stock if the investors require a 15 percent rate of return? Question content area bottom Part 1 The value of the common stock is $enter your response here. (Round to the nearest cent.)
A stock has just has paid a dividend has declared an annual dividend of $12.00 to be paid one year from today. The dividend is expected to grow 7% annual rate. The return on equity for similar stocks is 12%. what is Ро?
Quantitative Problem 2: Carlysle Corporation has perpetual preferred stock outstanding that pays a constant annual dividend of $1.00 at the end of each year. If investors require an 9% return on the preferred stock, what is the price of the firm's perpetual preferred stock? Round your answer to the nearest cent.$ per share Quantitative Problem 3: Assume today is December 31, 2013. Imagine Works Inc. just paid a dividend of $1.10 per share at the end of 2013. The dividend is expected to grow at 12% per year for 3 years, after which time it is expected to grow at a constant rate of 5% annually. The company's cost of equity (rs) is 9.5%. Using the dividend growth model (allowing for nonconstant growth), what should be the price of the company's stock today (December 31, 2013)? Do not round intermediate calculations. Round your answer to the nearest cent.$ per share
The dividend per share of Mavazi LTD as at 31st December 2017 was $ 2.50. The company's financial analyst has predicted that dividends would grow at 20% for 5 years after which growth would fall to a constant rate of 7% . The Analyst has also projected a required rate of return of 10% for the equity market. Mavazi LTD shares have a similar risk to the typical equity market. Required; What is the intrinsic value of shares of Mavazi LTD as at 31 December 2017.
Circuit City Stores (CC) recently paid a $.16 dividend. The dividend is expected to grow at a 23 percent rate. At the current stock price of $7.96, what is the return shareholders are expecting?
Shellbridge Corporation common stock has a par value of $25 and recently paid a dividend of $4.76 per share. The firm's dividends have grown from $1.50 to $4.76 over the past 10 years, which also reflects the expected growth in dividends for the indefinite future. The stock is selling for $40 and you think a reasonable required rate of return is 15%. What is the stock's intrinsic value? O $172.46 O $193.57 $31.73 $35.62 O $101.86
Example: Stock Valuation Consider the following information for the company Fledgling Electronics: Expected earnings per share at the end of year $8.33 Expected dividend per share at the end of year $5 Market capitalization rate (r) 15% Expected growth rate dividends (per year) 10% 1. Calculate the current price per share of Fledgling Electronics 2. Calculate the capitalized value of Fledgling's EPS if it had a no growth policy 3. Calculate the present value of Fledgling's growth opportunities
I. Common Stock Value- Constant Growth Let's Go Corporation, common stock paid a dividend of P12.50 per share last year. The company expects earnings and dividends to grow at 6% per year for the foreseeable future yea a. What is the value of the stock if the required rate of return is 12.5% per year. b. What is the required rate of return for this stock would result in a price per share of P250. =
Q2: NCH, which markets cleaning chemicals, insecticides, and other products, paid dividends of $2.00 per share on earnings of $4.00 per share. The book value of equity per share was @40.00 and earnings are expected to grow 5% a year in the long term. The stock has a beta of 0.85 and sells for $60 per share. The treasury bond rate is 7%. A. BAsed on these inputs, estimate the price/book value ratio for NCH. B. How much would the return on equity have to increase to justify the price/book value ratio at which NCH sells for currently.

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