a. If there is a 10 percent gain in the value of the dollar versus the euro, what will be the total percentage return to the F (Do not round Intermediate calculations. Round the final answer to 2 decimal places.) Total percentage return % b. Now assume the stock Increases by $10 but the dollar decreases by 10 percent versus the euro. What will be the tota return to the French Investor? (Round your final answer to the nearest whole percentage.) Total percentage return %

a. If there is a 10 percent gain in the value of the dollar versus the euro, what will be the total percentage return to the F (Do not round Intermediate calculations. Round the final answer to 2 decimal places.) Total percentage return % b. Now assume the stock Increases by $10 but the dollar decreases by 10 percent versus the euro. What will be the tota return to the French Investor? (Round your final answer to the nearest whole percentage.) Total percentage return %

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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How much would you be prepared to pay for a share in 3 years’ time that pays a $3.51 dividend each year constantly ? Assume the required rate of return is expected to remain constant at 5.17 per cent per year. Round your final answer to 2 decimal places. E.g. if the final value is $12345.8342, please type 12345.83 in the answer box (do not type the dollar sign).
Suppose a U.S. investor wishes to invest in a British firm currently selling for £40 per share. The investor has $12,000 to invest, and the current exchange rate is $2/£. a. How many shares can the investor purchase? (Round your answer to the nearest whole number.) Number of shares b. Fill in the table below for rates of return after one year in each of the nine scenarios (three possible share prices denominated in pounds times three possible exchange rates). (Round your answers to 2 decimal places. Leave no cells blank - be certain to enter "O" wherever required. Negative amounts should be indicated by a minus sign.) Dollar-Denominated Return (%) for Year-End Exchange Rate Price per Share (£) Pound-Denominated Return (%) $1.60/£ $2.00/£ $2.40/£ % % % % % £ 36 % % % % £ 41 % £ 46 % %
es Suppose a U.S. investor wishes to invest in a British firm currently selling for £40 per share. The investor has $20,000 to invest, and the current exchange rate is $2/£. Required: a. How many shares can the investor purchase? (Round your answer to the nearest whole number.) Number of shares b. Fill in the table below for dollar-denominated rates of return after one year in each of the nine scenarios (three possible share prices denominated in pounds times three possible exchange rates). (Round your percentage answers to 2 decimal places. Negative amounts should be indicated by a minus sign.) Price per Share (£) £ CH WH 33 38 43 Pound-Denominated Return (%) % % % Dollar-Denominated Return (%) for Year-End Exchange Rate $1.60/£ $2.00/£ $2.40/£ % % % % % % % %
Suppose a U.S. investor wishes to invest in a British firm currently selling for £100 per share. The investor has $24,000 to invest, and the current exchange rate is $2/£. Required:a. How many shares can the investor purchase? (Round your answer to the nearest whole number.) b. Fill in the table below for dollar-denominated rates of return after one year in each of the nine scenarios (three possible share prices denominated in pounds times three possible exchange rates). (Round your percentage answers to 2 decimal places. Negative amounts should be indicated by a minus sign.)
Suppose you start with buying a stock in £ (equivalent to $100) when the exchange rate is £1 = $1.5. One year later, the stock price changes to £75, and you sell it. At the time of the sale, the exchange rate is £1 = $1.6. What is your total percentage return? What percentage of your return is due to the exchange rate? Total return = 12.50%; Exchange rate return = 6.67%. Total return = 20%; Exchange rate return = 7.50%. Total return = 20%; Exchange rate return = 0.0%. Total return = 12.50%; Exchange rate return = 7.50%. Total return = 0.0%; Exchange rate return = 7.50%. Total return = 20%; Exchange rate return = 6.67%.
One year ago you bought the common stock of Mizuho at ¥1050 in Tokyo Stock Exchange. The price is ¥1000 today. You received a dividend of ¥120 per share during the period. The exchange rate was ¥100 = $1 when you bought the stock and it is ¥80 = $1 today. Calculate the realized dollar rate of return on the stock if you sell the stock today. Select one: -6.89% O b. 28.11% O C. 33.33% O d. 23.13% a.
(a) Calculate the euro-based return an Italian investor would have realized by investing €10,000 into a £50 British stock. One year after investment, the stock pays a £1 dividend, and sells for £55 the exchange rate has changed from €1.25 per pound to €1.30 per pound. (b) Calculate the euro-based return an Italian investor would have realized by investing €10,000 into a £50 British stock using 50 percent margin. One year after investment, the stock pays a £1 dividend, and sells for £54. In the meantime, the exchange rate has changed from €1.25 per pound to €1.30 per pound. The interest on the margin loan is 1 percent per year. The margin loan was denominated in pounds.
uppose a U.S. investor wishes to invest in a British firm currently selling for £33 per share. The investor has $66,000 to invest, and the current exchange rate is $2/£. Required:a. How many shares can the investor purchase? (Round your answer to the nearest whole number.) b. Fill in the table below for dollar-denominated rates of return after one year in each of the nine scenarios (three possible share prices denominated in pounds times three possible exchange rates). (Round your percentage answers to 2 decimal places. Negative amounts should be indicated by a minus sign.)
You are considering purchasing stock in a company that is expected to pay a $ 3.34 dividend later this year and you require a return of 7.79%. Assume the dividend will continue to be paid each year thereafter and will grow every year as described below. C What is the maximum price you would be willing to pay if you expect a growth rate of 2%? $ 58.84 (Enter as a whole number with two decimal places, such as 10.19.) What is the maximum price you would be willing to pay if you expect a growth rate of 5%? $ 125.70 What is the maximum price you would be willing to pay if you expect a growth rate of 7%? $452.38 What is the relationship between the price of a stock and the firm's growth rate? O A. The stock price is exactly equal to the growth rate times the dividend. B. As the growth rate investors expect increases, the price they are willing to pay also increases. OC. As the growth rate investors expect increases, the price they are willing to pay decreases. O D. There is no relationship.
Suppose a U.S. investor wishes to invest in a British firm currently selling for £40 per share. The investor has $10,000 to invest, and the current exchange rate is $2/£. a. How many shares can the investor purchase? Number of shares = b. Fill in the table below for rates of return after one year in each of the nine scenarios (three possible prices per share in pounds times three possible exchange rates). (Leave no cells blank - be certain to enter "0" wherever required. Negative values should be indicated by a minus sign. Do not round intermediate calculations. Round your answers to 2 decimal places.) Price per Share (£) Pound-Denominated Return (%) Dollar-Denominated Return (%)for Year-End Exchange Rate $1.80/£ $2/£ $2.20/£ £35 % % % % % % £40 % % % % % % £45 % % % % % %
You have just purchased a share of stock for $20.29.The company is expected to pay a dividend of $0.52 per share in exactly one year. If you want to earn a 9.1% return on your investment, what price do you need if you expect to sell the share immediately after it pays the dividend? The price one year from now should be $_______.(Round to the nearest cent.)
Suppose Malaysian Electronics stock is selling for $100 a share (Po = 100). Investors expect a $5 cash dividend over the next year (DIV1 = 5). They also expect the stock to sell for $110 a year hence (P1 = 110). What is the expected return to the stockholders?

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