ABC Analysis Stock Number Annual $ Volume Percent of Annual $ Volume J24 12,500 46.2 R26 9,000 33.3 L02 3,200 11.8 M12 1,550 5.8 P33 620 2.3 T72 65 0.2 S67 53 0.2 60 Q47 32 0.1 10 V20 30 0.1 Σ = 100.0

D0 = $2, g = 5%, P0 = $30, find the stock return 10% 11% 12% 13%

TABLE 5.3 Risk and return of investments in major asset classes, 1927-2018 Average Risk premium Standard deviation max min T-bills 3.38 na 3.12 14.71 -0.02 T-bonds 5.83 2.45 11.59 41.68 -25.96 Stocks 11.72 8.34 20.05 57.35 -44.04

QUESTION 5.1 Use the attached information and answer this qiestion: Use the Gordon growth model to estimate the cost of the ordinary shares of AMN Limited from the attached information.

STOCK HI LO % PE 100s CLOSE CHG (DIV) 62.50 38.00 RJW 1.60 3.2 17 10 ?? -49 a. What was the closing price for this stock that appeared in yesterday's paper? * b. If the company currently has 22 million shares of stock outstanding, what was net income for the most recent four quarters?

Stock i’s standard deviation35.00%Market’s standard deviation32.00%Correlation between Stock i and the market0.65Beta coefficient of Stock i:

Problem 9-21 Risk, Return, and Their Relationship (LG9-3, LG9-4)Consider the following annual returns of Estee Lauder and Lowes Companies: Estee LauderLowes CompaniesYear 123.9%6.0%Year 224.016.6Year 318.14.7Year 450.444.0Year 517.314.0Compute each stocks average return, standard deviation, and coefficient of variation.Note: Round your answers to 2 decimal places.

Marty McFly’s portfolio: Stock Number of Shares Price per Share A 110 $22 B 660 $16 C 360 $44 D 180 $33 The weight of stock C in Marty McFly’s portfolio is: a. 55.57   b. 38.61   c. 34.30   d. 50.57   e. 45.57

Esc Chapter 12 Practice Problems 1. Suppose a stock had an initial price of $77 per share, paid a dividend of $1.35 per share during the year, and had an ending share price of $83. Compute the percentage total return. Q Search 1 Q A N @ 2 W S F2 X # 3 E F3 D $ 4 R F DII % 5 F5 T G * F6 A 6 Y B * H & 7 PrtScn U N * 8 Home 1 M 9 Page K End о F10 ) 0 PgUp F11 P

B20 x✓ fx A B 5 Earnings 6 4 Shares Outstanding Dividends, Per Share (Just Paid) 7 Return on Equity 8 Beta 9 10 Market Data 11 Market Return 12 Risk-Free Rate 13 25,000,000 $50,000,000 $1.25 0.15 1.35 Expected Return 0.12 0.03 14 Required: 15 16 Using the information in the tables above, complete the necessary steps to calculate the P/E ratio and the PEG ratio. 17 (Use cells A4 to B12 from the given information to complete this question.) 18 19 The M. Smith and Family Corporation 20 Capitalization Rate 21 Earnings Per Share 22 Plowback Rate 23 Sustainable Growth Rate 24 Price 25 P/E Ratio 26 Sustainable Growth Rate (as Percentage, use for PEG Calculation) 27 PEG Ratio 28 29 Calculations $2.00 0.375 0.056 5.625