Year20X120X220X320X420X5Earningsper Share$ 10.0010.5011.0311.5812.16The earnings per share have grownat a constant rate (on a roundedbasis) and will continue to do so inthe future. Dividends represent 40percent of earnings.a. Project earnings and dividendsfor the next year (20X6).Note: Round the growth rate tothe nearest whole percent. Donot round any otherintermediate calculations.Round your answers to 2decimal places.EarningsDividend20X6

First we need to calculate constant growth rategrowth rate = (Last EPS/ First EPS)(1/number of…

Answered: Year 20X1 20X2 20X3 20X4 Earnings per…

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Finance

Year 20X1 20X2 20X3 20X4 Earnings per Share $ 10.00 10.50 11.03 11.58

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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Question

Year
20X1
20X2
20X3
20X4
20X5
Earnings
per Share
$ 10.00
10.50
11.03
11.58
12.16
The earnings per share have grown
at a constant rate (on a rounded
basis) and will continue to do so in
the future. Dividends represent 40
percent of earnings.
a. Project earnings and dividends
for the next year (20X6).
Note: Round the growth rate to
the nearest whole percent. Do
not round any other
intermediate calculations.
Round your answers to 2
decimal places.
Earnings
Dividend
20X6

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