KTime left 0:59:42estion 1wweredarked out ofwquestionMr. Johnson owns $300 shares of NYCO's preferred stock which currently sells for $30.00 pershare and pays annual dividends of $2.00 per share. What is the required return?Select one:O a. 15.0 percentO b. 6.67 percentO c. 15.2 percentOd. 10.0 percentO e. 6.78 percentQuestion 2Not yetaquaradWICB's stock's intrinsic value is $48.40, the required rate of return is 12.5 percent and thedividend growth rate is 10 percent, what is WICB's recent dividend?

1. Compute required return: Required return = Annual dividend * 100 / Current price of stock…

Answered: K Time left 0:59:42 estion 1 wwered…

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 4PROB

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ou purchase 100 shares of stock for $50 a share. The stock pays a $2 per share dividend at year-end. a. What is the rate of return on your investment if the end-of-year stock price is (i) $48; (ii) $50; (iii) $54? (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers as a whole percent.) Rate of Return 48 50 54 b. What is your real (inflation-adjusted) rate of return if the inflation rate is 3%? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Negative amounts should be indicated by a minus sign.) Real rate of Return 48 50 54
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