Cooperton Mining just announced it will cut its dividenc from $4.25 to $2.29 per share and use the extra funds expand. Prior to the announcement, Cooperton's divide were expected to grow at a 3.1% rate, and its share pr was $50.34. With the planned expansion, Cooperton's dividends are expected to grow at a 4.9% rate. What s price would you expect after the announcement? (Ass that the new expansion does not change Cooperton's Is the expansion a good investment?
Cooperton Mining just announced it will cut its dividenc from $4.25 to $2.29 per share and use the extra funds expand. Prior to the announcement, Cooperton's divide were expected to grow at a 3.1% rate, and its share pr was $50.34. With the planned expansion, Cooperton's dividends are expected to grow at a 4.9% rate. What s price would you expect after the announcement? (Ass that the new expansion does not change Cooperton's Is the expansion a good investment?
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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Transcribed Image Text:Cooperton Mining just announced it will cut its dividend
from $4.25 to $2.29 per share and use the extra funds to
expand. Prior to the announcement, Cooperton's dividends
were expected to grow at a 3.1% rate, and its share price
was $50.34. With the planned expansion, Cooperton's
dividends are expected to grow at a 4.9% rate. What share
price would you expect after the announcement? (Assume
that the new expansion does not change Cooperton's risk.)
Is the expansion a good investment?
The new price for Cooperton's stock will be $. (Round
to the nearest cent.)
Is the expansion a good investment? (Select from
the drop-down menu.)
a good investment.
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