Assume IBM just paid a dividend of £4.50 and expects these dividends to grow at 8% a year. The ex-div price of IBM is £100 per share. What is IBM's cost of equity capital?   A. 3.86%   B. 8%   C. 12.22%   D. 12.86%

Q: 4. You expect RMT company will have earnings per share of AED 10 this year and expect that they will…

A: Dividend is the part or share of profits being distributed to the shareholders. Dividend growth rate…

Q: 2. XYZ Ltd just paid a dividend of €0.75 on its equity. The growth rate of dividends is expected to…

A: Variables in the question:D0=€0.75Growth rate=4% per year indefinitelyRate of return:For first two…

Q: A firm has 8,000,000 ordinary shares outstanding. The current market price is `25 and the book value…

A: First we need to calculate Return on Equity (ROE) by using equation below.ROE = EPS/ Book…

Q: Spice, Inc. just paid a dividend of $1.80 per share. The dividends are anticipated to maintain a 4.5…

A: The expected rate of return on stock refers to the total amount of return that is being provided by…

Q: Flatline Inc currently will pay a cash divide $40. What's the most likely price of Flatline on the…

A: Ex dividend date is date only one day before the dividend are recorded in books of the company and…

Q: 3. The firm's stock has a required rate of return of 11.50%, and it sells for P 35.00 per share. The…

A: Where,P0 = Stock value D0 = Current dividend g = growth rate in decimal format  D0 ( 1 + g)…

Q: The dividend that was just paid for ABC stock was $3.25. The company is expected to grow at 6% in…

A: Current Dividend = d0 = $3.25Growth Rate for year first 4 years = g4 = 6%Constant Growth Rate after…

Q: Q4 NoGrowth Corporation currently pays a dividend of $0.59per quarter, and it will continue to pay…

A: Price per share refers to the market price per share when dividend income is discounted against the…

Q: Company X just paid (year 0) a dividend of $1.20. If you expect Company X's dividends to grow at 7%…

A: As per the constant growth rate model, the price of the bond can be found by considering the…

Q: Q.An unlevered company that has a current value of $1,600,000 is considering borrowing $700,000 and…

A: EBIT: EBIT stands for earnings before interest and taxes. It indicates firm profitability. It is the…

Q: Kahn Inc. has a target capital structure of 60% common equity and 40% debt to fund its $12 billion…

A: WACC = weight of equity*cost of equity + weight of debt*after tax cost of debt after tax cost of…

Q: 6. Assume that company Otto currently pays out a dividend of £8 per share and dividends are expected…

A: Dividend is the share or part of profits that is being distributed to shareholders. Dividend growth…

Q: K You just purchased a share of SPCC for $97. You expect to receive a dividend of $6 in one year. If…

A: Capital gain is the profit one earns on the sale of an asset like stocks, bonds or real estate. It…

Q: Assume Highline Company has just paid an annual dividend of $1.05. Analysts are predicting an 11.7%…

A: Variables in the question:D0=$1.05Growth rate (G1)over next 5 years=11.7% Growth rate…

Q: Calculate the cost of capital for a new common stock issue by a firm that paid a $1.80 dividend last…

A: Current dividend = d0 = $1.80 Growth rate = g = 7% Price of common stock = p = $30

Q: Calculating Cost of Equity Hoolahan Corporation's common stock hasS a beta of .87. If the risk-free…

A: The cost of capital is the return required by a company to determine if an investment meets the…

Q: .  Suppose you invested £100 in ASOS a year ago. It paid a dividend of £2 today and then you sold it…

A: Holding period return is rate of return realized by holding the stock during the and all cash flow…

Q: am. 112.

A: The objective of this question is to calculate the value of a stock today based on the Gordon Growth…

Q: A firm just paid its first annual dividend of $0.12 a share. The firm plans to increase the dividend…

A: Variables in the question:D0=$0.12g=3.5% (per year indefinitely)Current stock price=$6.50Working…

Q: Which of the following firms is the most leveraged? O Cash coverage ratio 1.64 Cash coverage ratio…

A: Hi There, Thanks for posting the questions. As per our Q&A guidelines, must be answered only one…

Q: Given the following information, what is the terminal (horizon) value of the company? The company…

A: Terminal value, in the context of the Dividend Discount Model (DDM), refers to the present value of…

Q: Suppose a firm has a retention ratio of 37 percent and net Income of $5.2 million. How much does it…

A: Concept The payout ratio means how much a company pays its earnings after tax to its shareholders.…

Q: Krell Industries has a share price of $22.58 today. If Krell is expected to pay a dividend of $0.87…

A: Dividend yield, capital gain and return on investment are all financial ratios an investor would…

Q: You bought a stock one year ago for $50.00 per share and sold it today for $45.00 per share. It paid…

A: Realized return refers to the actual return generated by the asset over a period of time. This…

Q: Question Suppose a firm raises $23 million dollars by issuing debt at a cost of 6.1%, raises $14…

A: Debt = $23 millions Cost of Debt (Kd) = 6.1% or 0.061 Common Stock = $14 millions Cost of Common…

Q: Assume Gillette Corporation will pay an annual dividend of $0.69 one year from now. Analysts expect…

A: Current price of share is that price which can be paid for purchase of the share. It is also called…

Q: nterest rate Tax rate Dividend Common stock on the market Growth rate Debt ratio 9% 30% $2.50 $50 8%…

A: Cost of capital The rate of interest paid by a company to investors for the use of their funds in…

Q: 12.  A firm has a total market value of £30,000. It borrows £7500 at 8% interest rate. If the return…

A: Cost of Equity can be calculated as = (Earning for Equity Shareholder / Market Value of Equity) x…

Q: 4. Company X does not plow back any earnings and is expected to produce a level dividend stream of…

A: Cost of equity Capital = Dividend for next year / share price  + growth rate  Since the company does…

Q: ? he historical dividend yield of a stock is 5.21% and the stock's cost of capital is 12.58%, what…

A: In this question we will be solving multiple questions on stock valuation , Capital Assets Pricing…

Q: Mackenzie Company has a price of $33 and will issue a dividend of $2.00 next year. It has a beta of…

A: Dividends are a part of net income that is paid to the shareholder of the company in the form of a…

Q: Investors expect Danforth Technologies (DT) to have a stock price one year from now of $52 per…

A: Share price = $52 Dividend = $3 per share Cost of capital = 10%

Q: Lincoln National just paid out a dividend of $4.46 and dividends are expected to grow at 5% each…

A: Intrinsic value of stock will be calculated using formula :   Intrinsic value = D0 × (1+g)ke  -…

Q: What will be the price of a share in year 4, given dividend just paid (Do) as $3, required rate of…

A: P = where ,P = market price of shareD = dividend for current yearg = growth ratek = required rate of…

Q: The last paid dividend is $2 for a share of ordinary shares that is currently selling for $20. What…

A: Information Provided: Dividend paid = $2 Growth rate = 8% Price of share = $20

Q: 6. Jemisen's has expected earnings before interest and taxes of £6,200. Its unlevered cost of…

A: Weighted average cost of capital (WACC) is the average cost of capital. It can be calculated by…

Q: QUESTION 15 Suppose that a firm has $500K in long term debt, $25K in preferred stock and $375K in…

A: The question submission involves 2 questions. As per honor code of portal, we can provide answer…

Q: Constamt urowtl ASset valuauon ти ויקסדד 10. A company plans to pay a dividend of $3.20 exactly one…

A: According to Gordon growth model, when the dividends are paid indefinitely and are expected to grow…

Q: Krell Industries has a share price of $22.58 today. If Krell is expected to pay a dividend of $0.93…

A: Dividend yield = Dividend expected to pay / current share priceEquity cost of capital = Expected…

Q: Matilda Industries pays a dividend of £2.10 per share and is expected to pay this amount…

A: Solution: Given, Dividend paid per share =D0 = £2.10 As given in the question, Expected dividend…

Q: Family Business Topic: Compensation/Discrimination Characters: Jane, Manager, Payroll Department for…

A: Recommendations: 1.Jаnе cаn ignоrе thе рrоblеm аnd sау nоthing. 2. Jane could speak privately with…

Q: suppose you manage a $200,000 company that consist of the following invest: A  $50,000   beta  .095…

A: With the given information, we can calculate the holding of company beta as follows:

Q: 24. Zero-Sum Enterprise has just now paid a dividend of S8.00 per share (DO); the dividends are…

A: In this question we requires to calculate Current value of Stock of Zero-Sum Enterprise. We can…

Q: You expect future free cash flow (FCF) of a company to grow at a contstant rate g. Given the FCF for…

A: Given:

Q: 10.  Consider the following price and dividend data for Quicksilver Inc.:   Year Price (£)…

A: Concept. At annual rate of return , Sum of Present value of dividend and present value of share…

Q: SIROM Scientific Solutions has £12 million of outstanding equity and £4 million of bank debt. The…

A: Solution: Given, Equity Capital = $12 Million Debt Capital = $4 Million Total Capital = $12 + $4 =…