Suppose the risk-free rate is 2.10% and an analyst assumes a market risk premium of 5.26%. Firm A just paid a dividend of $1.00 per share. The analyst estimates the B of Firm A to be 1.43 and estimates the dividend growth rate to be 4.28% forever. Firm A has 282.00 million shares outstanding. Firm B just paid a dividend of $1.91 per share. The analyst estimates the B of Firm B to be 0.90 and believes that dividends will grow at 2.00% forever. Firm B has 195.00 million shares outstanding. What is the value of Firm A?

Suppose the risk-free rate is 2.10% and an analyst assumes a market risk premium of 5.26%. Firm A just paid a dividend of $1.00 per share. The analyst estimates the B of Firm A to be 1.43 and estimates the dividend growth rate to be 4.28% forever. Firm A has 282.00 million shares outstanding. Firm B just paid a dividend of $1.91 per share. The analyst estimates the B of Firm B to be 0.90 and believes that dividends will grow at 2.00% forever. Firm B has 195.00 million shares outstanding. What is the value of Firm A?

Name: #29Suppose the risk-free rate is 2.10% and an analystassumes a market
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Description: #29Suppose the risk-free rate is 2.10% and an analystassumes a market risk premium of 5.26%. Firm A justpaid a dividend of $1.00 per share. The analystestimates the B of Firm A to be 1.43 and estimates thedividend growth rate to be 4.28% forever. Fi

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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