52-Week Price Lo 10.43 Acevedo .36 Hi 77.40 55.81 130.93 50.41 35.00 33.42 69.50 14.12 Stock (Dividend) Georgette, Incorporated 1.54 YBM 2.00 Manta Energy .97 20.74 Winter Sports .32 Dividend Yield % 2.6 3.8 2.2 6.2 1.5 PE Ratio 6 10 10 6 28 Close Price 13.90 40.43 88.97 15.60 ?? Net Change -.24 -.01 3.07 -.26 .18 According to your research, the growth rate in dividends for Manta Energy for the previous 10 years has been negative 10 percent. If investors feel this growth rate will continue, what is the required return for the stock?

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter15: Capital Investment Analysis
Section: Chapter Questions
Problem 15.1.1MBA
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Question
52-Week Price
Lo
10.43
33.42
69.50
14.12
Manta Energy .97
20.74 Winter Sports .32
Hi
77.40
55.81
130.93
50.41
35.00
Stock (Dividend)
Acevedo .36
Georgette, Incorporated 1.54
YBM 2.00
X Answer is complete but not entirely correct.
Required return
Dividend
Yield %
2.6
3.8
2.2
6.2
1.5
-3.80 × %
PE
Ratio
6
10
10
6
28
Close
Price
13.90
40.43
88.97
15.60
??
According to your research, the growth rate in dividends for Manta Energy for the previous 10 years has been negative 10 percent. If
investors feel this growth rate will continue, what is the required return for the stock?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a
percent rounded to 2 decimal places, e.g., 32.16.
Net Change
-.24
-.01
3.07
-.26
.18
Transcribed Image Text:52-Week Price Lo 10.43 33.42 69.50 14.12 Manta Energy .97 20.74 Winter Sports .32 Hi 77.40 55.81 130.93 50.41 35.00 Stock (Dividend) Acevedo .36 Georgette, Incorporated 1.54 YBM 2.00 X Answer is complete but not entirely correct. Required return Dividend Yield % 2.6 3.8 2.2 6.2 1.5 -3.80 × % PE Ratio 6 10 10 6 28 Close Price 13.90 40.43 88.97 15.60 ?? According to your research, the growth rate in dividends for Manta Energy for the previous 10 years has been negative 10 percent. If investors feel this growth rate will continue, what is the required return for the stock? Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Net Change -.24 -.01 3.07 -.26 .18
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