Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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if the interest rate used in 5% how much would people be willing to pay for a share of stock that is expected to yield a $20 per share stream of dividend each year go to continuously into future quizlet
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- K Melissa Cutt is thinking about buying some shares of EZLawn Equipment, at $46.30 per share. She expects the price of the stock to rise to $47.65 over the next 3 years. During that time she also expects to receive annual dividends of $6.79 per share. a. What is the intrinsic worth of this stock, given a required rate of return of 12%? b. What is its expected return? BCCCID a. The intrinsic worth of this stock is $ 50.22. (Round to the nearest cent.) b. The expected return is %. (Round to one decimal place.)arrow_forwardYou buy a share of stock for $100 and a year later the market price is $105 and it pays a dividend of $2. What is the return?arrow_forward11. I need help with finance home work question asap please A stock that currently sells for $120 has EPS of $20.75. What is the annual rate of return on this stock if the company is expected to pay a dividend per share in the amount of $18 each year forever?arrow_forward
- What would you pay today, in dollars, for a stock that is expected to make a $2 dividend in one year if the expected dividend growth rate is 5% and you require a 12% return on your investment? 28.57 29.33 31.43 43.14 54.30arrow_forwardH3. Capello's Deli traditionally pays an annual dividend of $1.65 per share. The firm is projecting dividends of $1.80 and $2.05 over the next two years, respectively. After that, the company expects to pay a constant dividend of $2.25 a share. What is the maximum amount you are willing to pay for one share of this stock if your required return is 10 percent? Please show proper step by step calculationarrow_forwardIf the next year's dividend was $2 per share and all future dividends will decrease by 5 percent annually. What is the stock worth today at a required return of 15 percent? 9.5 19 10arrow_forward
- How much would you pay for a Summerhill common stock that pays a dividend of $1.8? You believe that Summerhill will grow at the rate of 11% for the long term, and you would require a return of 13% from such a stock.a. $ 99.90b. $90.00c. $ 15.37d. $88.27e. $ 14.45arrow_forwardHello tutor Please helparrow_forwardA stock is expected to pay its first $0.8 dividend in 3 years from now (t=3). The dividend is expected to be paid annually forever and grow by 2% pa. The discount rate is 8% pa. Estimate what the stock price will be in 2.25 years from now. The stock price at time 2.25 is expected to be: Select one: a. $13.9408 b. $13.6675 c. $13.5924 d. $13.1368 e. $12.5855arrow_forward
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