Concept explainers
a)
To determine: The average dividend yield for S&P 500.
Introduction:
Dividend yield is a ratio that specifies how much a company pays as dividends every year, on comparing with its share price. It is considered as the
b)
To determine: The volatility of the dividend yield.
Introduction:
Dividend is a sum of money paid to the shareholders of the company. It is distributed among the investors from the portion of company’s earnings.
c)
To determine: The average annual return of the S&P500 of 2002 to 2014.
Introduction:
Average annaul return refers to the returns that an investment earns in an average year over different periods.
d)
To determine: The volatility of the S&P500 returns from
Introduction:
Return is a loss or gain incurred on the investment made by the investors. It is expressed in terms of percentage.
e)
To discuss: The capital gains or dividends are most important components of the average returns of S&P500 in the period.
Introduction:
Capital gains yield is a ratio that indicates the rise in the price of the common stock.
Want to see the full answer?
Check out a sample textbook solutionChapter 10 Solutions
Corporate Finance (4th Edition) (Pearson Series in Finance) - Standalone book
- Nikes annual balance sheet and income statement for 2022-2023 and 2024arrow_forwardWhat is the value at the end of year 3 of a perpetual stream of $70,000 semi-annual payments that begins at the end of year 7? The APR is 12% compounded quarterly.arrow_forwardFirm A must pay $258,000 to firm B in 10 years. The discount rate is 16.44 percent per year. What is the present value of the cash flow associated with this arrangement for firm A? -I got the answer of 56331.87773=56332 (rounded to the nearest dollar), but it says incorrect.arrow_forward
- Suppose you have two histograms: one where the mean equals the median, and one where the mean is different from the median. How would you expect the two histograms to differ.arrow_forward(a) The variables have been stripped of their names. Which one do you think is "household income" ?(b) Calculate the mean, median, and standard deviation of household income. Do these numbers fit with your expectations? (c) Suppose you have two histograms: one where the mean equals the median, and one where the mean is different from the median. How would you expect the two histograms to differ?arrow_forwardJanet Foster bought a computer and printer at Computerland. The printer had a $860 list price with a $100 trade discount and 210210 , n30n30 terms. The computer had a $4,020 list price with a 25% trade discount but no cash discount. On the computer, Computerland offered Janet the choice of (1) paying $150 per month for 17 months with the 18th payment paying the remainder of the balance or (2) paying 6% interest for 18 months in equal payments. Assume Janet could borrow the money for the printer at 6% to take advantage of the cash discount. How much would Janet save? Note: Use 360 days a year. Round your answer to the nearest cent.arrow_forward
- Essentials of Business Analytics (MindTap Course ...StatisticsISBN:9781305627734Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. AndersonPublisher:Cengage LearningIntermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningPFIN (with PFIN Online, 1 term (6 months) Printed...FinanceISBN:9781337117005Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage LearningEBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT