Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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- please answer d, e, and farrow_forwardA stock is expected to pay a dividend of $1.00 at the end of the year (i.e., D1 = $1.00), and it should continue to grow at a constant rate of 9% a year. If its required return is 14%, what is the stock's expected price 2 years from today? Do not round intermediate calculations. Round your answer to the nearest cent. $|arrow_forwardBlue is currently selling for $26 per share. Its next dividend (in one year) is forecasted to be $1. Immediately after the dividend is paid, you expect the price to be $33. a. What is its expected dividend yield? b. What is its expected capital gain rate? c. What is the equity investors' expected return? Question content area bottom Part 1 a. Dividend yield: enter your response here%. (Round to two decimal places.) b. Capital gain rate: enter your response here%. (Round to two decimal places.) c. Expected Return: enter your response here%. (Round to two decimal places.)arrow_forward
- A stock is selling for $50 in the market. The required rate of return is 9%. The most recent dividend paid is D0 = $3.0 and dividends are expected to grow at a constant rate g. What’s the expected capital gain for this stock?arrow_forwardSuppose DO = $2.00. rs= 9%, What if g = 30% the first year, 20% the second year, and 10% the third year, and return to its long-run constant growth rate of 4%, Calculate the value of the stock today? O $62.7846 O $55.5021 O $60.3211 O $65.7223 O $72.3487arrow_forward1arrow_forward
- A stock is expected to pay a dividend of $1.00 at the end of the year (i.e., D1 = $1.00), and it should continue to grow at a constant rate of 5% a year. If its required return is 12%, what is the stock's expected price 4 years from today? Do not round intermediate calculations. Round your answer to the nearest cent. $arrow_forwardAssume that a stock is giving $2 dividends and the expected rate of return is 10%, how much the stock price will be selling today?arrow_forwardA stock just paid a dividend of D0 = $1.50. The required rate of return is rs = 8.5%, and the constant growth rate is g = 4.0%. What is the current stock price? Select the correct answer. a. $35.57 b. $36.47 c. $37.37 d. $38.27 e. $34.67arrow_forward
- You are considering the purchase of a new stock. The stock is expected to grow at 2.52% for the foreseeable future and just paid a $2.88 dividend (D0). The required return is 8.2%. Based on this, what is the value of the stock? Round calculations to the nearest cent.arrow_forwardFind the annualized holding rate of return and the average rate of return for a stock that returned -30% in year 1 and +30% in year 2. Annualized holding rate of return = -7.00% A. -9.00% B. -15.00% C. 0.00%arrow_forwardA preferred stock is expected to pay a constant quarterly dividend of $1.75 per quarter into the future. The required rate of return, Rs, on the preferred stock is 12.0 percent. What is the fair value (or price) of this stock? Group of answer choices a. $18.65 b. None of the above c. $37.04 d. $24.36 e. $58.33arrow_forward
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