An investor is considering investing into the shares of a start-up company. Theinvestor's approach to share valuation is to discount future expected dividends at a rateof 5.0% per annum.The company is an online food delivery service that is expected to start paying annualdividends of 6p per share in 3 years' time. Dividends are expected to remain constantfor years and then start increasing at a rate of 3.5% per year.(c) After 3 years the investor sells the company's shares for £4.00 per share.Assuming the investor pays income tax at 40% and the capital gains tax rate is28% determine the investor's net yield on this investment after tax.

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Answered: An investor is considering investing…

Advanced Engineering Mathematics

10th Edition

ISBN:9780470458365

Author:Erwin Kreyszig

Publisher:Erwin Kreyszig

Chapter2: Second-order Linear Odes

Section: Chapter Questions

Problem 1RQ

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An equipment costing P250,000 has an estimated life of 15 years with a book value of P30,000 at the end of the period. Compute the depreciation charge and its book value after 10 years using declining balance method.
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Find the saving balance after 15 years with an APR of 3.2% and monthly payments of $200
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#2 amount is 120,448
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A company borrowed $45,000 for 3 years at 5% COMPOUNDED MONTHLY. It will NOT make any payments on this loan prior to maturity. (a) Find the TOTAL future value the company will need to accumulate to pay off this debt. Show all work. (b) Use the result of part (a) to find the quarterly sinking fund payment needed to accumulate this maturity value (over the the 3 years), assuming 4% rate. Show all work.
(c)In the previous year, at Hub Motors ltd, for a particular model of Mercedes, Nissan and Ford, one could purchase (in million shillings) all three cars for a total of Ksh 152. This year, due to inflation, the same cars would cost Ksh 171. The cost of the Mercedes increased by 8.5%, the Nissan by 6.5%, and the Ford by 12.5%. If the price of last year’s Nissan was Ksh 7 less than the price of last year’s Mercedes, Use matrix inverse to find the price of each of the three cars last year. (Your matrix should be a three by three)
Caspian Bank wants to borrow 100 000 000 KZT from KKB through the repurchased agreement to finance its short-term liquidity problems. The current market price of Tbills is 930 KZT per 1000 KZT of the face value. The average annual interest rate on REPOs is 3%. Desirable maturity is 7 days. What will be the total interest you will pay to KKB from this transaction? Apply the formula below. Pc = (i/365) x n x (P0/100) + P0
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