Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's discounted payback in years? Answer should correct up to 2 decimal places. Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's net present value? Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's profitability index? Answer should correct up to 2 decimal places.
Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
Instruction: Use the table below to acquire information and answer the following questions. Please do not use signs like Rs., $, % etc in your answer. If you calculate percentage as 10.23% than answer must write like 10.23 only (do not write like 10.23% or 0.1023)
|
Year |
0 |
1 |
2 |
3 |
4 |
|
Cash flows |
−$950 |
$525 |
$485 |
$445 |
$405 |
- Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's discounted payback in years? Answer should correct up to 2 decimal places.
- Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's
net present value ? - Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's profitability index? Answer should correct up to 2 decimal places.
- Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's
internal rate of return ? - Ms ABC is considering an opportunity of a new investment that has the following cash flow and weighted average cos of capital is 13 percent. What is the project's modified internal rate of return (MIRR)? Consider finance and reinvestment rate are same as WACC.
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