None Carl Patterson likes investing in stocks that paydividends. Carl owns 120 shares of a local utilitycompany. The stock pays a regular annual dividendin the amount of $5.50 per share and the companyhas indicated that the dividend will stay the samefor a long time. If Carl reinvests his dividends eachyear and the dividends earn a return of 7 percenteach year, how much will Carl accumulate in 14years?

Step 1: Given Value for Calculation Number of Share = n = 120Annual Dividend Per Share = dps =…

Answered: Carl Patterson likes investing in…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter2: The Domestic And International Financial Marketplace

Section: Chapter Questions

Problem 2P

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Carl Patterson ikes investing in stocks that pay dividends. Carl owns 100 shares of a local utility company. The stock pays a regular annual dividend in the amount of $4.50 per share, and the company has indicated that the dividend will stay the same for a long time. if Cart reinvests his dividends each year and the dividends earn a return of 7 percent each year, how much will Car accumulate le 15 years? Use Exhibit 1-A Exhibit 18. Exhibit 1-C. Exhibit 10. Note: Use appropriate factor(s) from the tables provided. Do not round your intermediate calculations. Round time value factor to 3 decimal places and final answer to 2 decimal places. Future value annuity
Ghaith has bought shares of RIO, Inc. stock for $25.00 per share. He expects a $1.00 dividend at the end of this year. After 2 years, he expects to receive a dividend of $1.25 and to sell the stock for $28.75. What is Ghaith's required rate of return?
Alex purchases 100 stocks in a company that pay dividends of $10 every year for the next 5 years. However, the prevailing interest rates at which he can discount future earnings changes from 4% in the first 3 years to 6% in the next 2 years. What is the present value of the dividend income?
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Becky Martinez owns stock in GBX Corporation. The GBX stock has a current market value of $70 a share. If Becky receives $1.40 a year in dividends, what is the dividend yield?
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Mr. Peloskiis looking at investing in shares of XYZ Corporation. Yesterday XYZ paideout an annual dividend of $8 per share. The XYZ Corporation is expected to grow in production and profits (and in dividends) at a rate of 5% per year. How much should Mr. Peloskipay for one share of XYZ Corporation if his desired rate of return is 7% per year?
Last year Vivienne bought 100 shares of Holding Corporation common stock for $43 per share. During the year he received dividends of $1.30 per share. The stock is currently selling for $50 per share. What rate of return did Vivienne earn over the year?
Last year Daniel bought 100 shares of Texas Corporation common stock for R53 per share. During the year he received dividends of R1.45 per share. The stock is currently selling for R60 per share. What rate of return did Daniel earn over the year? What is the correct answer? A. 11.7 percent B. 13.2 percent C. 14.1 percent D. 15.9 percent
Greg purchased 200 shares of XYZ stock at $90 per share 8 years ago. Today he told all 200 shares for $20,000. What was his average annual compound return on this investment (ignoring taxes and inflation)? (Please use and round to two decimals) a. 1.01 b. 1.46 c. 1.54 d. 1.33

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