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- 10. Consider the following price and dividend data for Quicksilver Inc.: Year Price (£) Dividend (£) 0 10 1 0.14 2 0.14 3 14 0.14 Assume that you purchased Quicksilver's share in year 0 and sold it at the end of year 3. Your annual rate of return for holding this share is closest to ________. A. 8% B. 14% C. 20% D. 19%Company R has paid most recent dividend as $2.55. The dividend will be paid by the company forever and the dividend will grow at 6.00% forever. The required rate of return is 10%. What will be the current stock price? a. $63.750 b. $67.575 c. $65.125 d. $67.255Credenza Industries is expected to pay a dividend of $1.50 at the end of the coming year. It is expected to sell for $61 at the end of the year. If its equity cost of capital is 9%, what is the expected capital gain from the sale of this stock at the end of the coming year? .... O A. $57.34 O B. $5.04 OC. $55.96 O D. $3.66 ..
- The Co. pays an annual dividend that is expected to increase by 4.1%/year. The stock’s return = 12.6% and sells for $24.9/share. Calculate the next dividend (D1) A. $2.03B. $2.12C. $3.17D. $2.20The Evanec Company's next expected dividend, D1, is $3.08; its growth rate is 4%; and its common stock now sells for $39.00. New stock (external equity) can be sold to net $31.20 per share. a. What is Evanec's cost of retained earnings, rs? Do not round intermediate calculations. Round your answer to two decimal places. rs b. What is Evanec's percentage flotation cost, F? Round your answer to two decimal places. F = % c. What is Evanec's cost of new common stock, re? Do not round intermediate calculations. Round your answer to two decimal places. re = %Credenza Industries is expected to pay a dividend of $1.55 at the end of the coming year. It is expected to sell for $68 at the end of the year. If its equity cost of capital is 10%, what is the expected capital gain from the sale of this stock at the end of the coming year? OA. $63.23 OB. $4.77 O.C. $61.82 OD. $6.18
- A company currently reported dividend of $12. It is expected that will reinvest 50% of its earnings perpetually. The return on equity of the company is 20% and remains unchanged in the future. Suppose the cost of equity of the company is 13%, what is the fair price of the stock based on the dividend discount model? A. $200 В. S220 C. $400 D. $440Ch. 9. The next dividend payment by Skippy Jon Jon, Inc., will be $1.08 per share. The dividends are anticipated to maintain a growth rate of 4 percent, forever. The stock currently sells for $24 per share. What is the required return? (Do not round intermediate calculations and enter your answer as a percent rounded to 1 decimal place, e.g., 32.1.) Format as a percentage as "X.X"Why do you deduct or subtract 1 to flotation cost? Example: Given; Annual dividend (D) = $4.75 Flotation cost (F) = 0.05 or 5% Number of shares issued (N) = 10,000 Stock price (P0) = $50 Formula; Total value able to receive = N * P0 * (1 - F) Total value able to receive = 10,000 * $50 * (1 - 0.05) Total value able to receive = $500,000 * 0.95 Total value able to receive = $475,000
- Estimate its cost of common equity, Maxell and Associcates recently hired you. Obtain the following data, D0=$0.90, P0= $27.50, gl=7% constant. Based on the dividend grwoth model, What is the cost of common for reinvested earnings? (10.50%,9.29%,10.08%,9.68%,10.92%)16) IGM Realty had stock prices of $33, $33, $38, $36, and $28 at the end of the last five quarters. If IGM pays a dividend of $1 at the end of each quarter, what is the annual realized return on IGM? A) -5.62% B) -4.49% C) -4.72% D) -4.94%6. Dividend discount model (S4.3) Company X is expected to pay an end-of-year dividend of $5 a share. After the dividend, its stock is expected to sell at $110. If the cost of equity is 8%, what is the current stock price?