2 (a) What actions that shareholders can take to ensure that management's and shareholders" interests are aligned? Discuss (b) Prima Corporation's dividend per share next yoar is expected to be RM3.02 and the firm expects dividends to grow at a rate of 5% per year for the foreseeable future. If you can eam 13% on similar-risk investments, what is the most you would be willing to pay per share? you can earn only 10% on similar-risk investments, what is the most you would be willing to pay per share? Compare and contrast your findings, and explain the impact of changing risk on share value.
2 (a) What actions that shareholders can take to ensure that management's and shareholders" interests are aligned? Discuss (b) Prima Corporation's dividend per share next yoar is expected to be RM3.02 and the firm expects dividends to grow at a rate of 5% per year for the foreseeable future. If you can eam 13% on similar-risk investments, what is the most you would be willing to pay per share? you can earn only 10% on similar-risk investments, what is the most you would be willing to pay per share? Compare and contrast your findings, and explain the impact of changing risk on share value.
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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Q4b
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Transcribed Image Text:2. (a) What actions that shareholders can take to ensure that management's and shareholders' interests
are aligned? Discuss.
(b) Prima Corporation's dividend per share next year is expected to be RM3.02 and the firm expects
dividends to grow at a rate of 5% per year for the foreseeable future.
If you can earn 13% on similar-risk investments, what is the most you would be willing to pay per
share? If you can earn only 10% on similar-risk investments, what is the most you would be willing
to pay per share? Compare and contrast your findings, and explain the impact of changing risk on
share value.
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