What is the value of each preference share using the zero-growth model? 2. What is the importance of knowing the value of the preference share using the zero-growth model?
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- 4. Ryza Tatlonghari wants to buy 5,000 preference shares, P150 par value from Mawon Lim. According to her sources, the preference shares come with a constant dividend of P42 per share. Ryza intends to hold the preference shares long-term and has no plans on selling them soon. Moreover, she requires a 12% return on all his investments. What is the value of each preference share? 5. Rachelle Ching is an investment analyst. She was asked by Macrille Samson, an investor, to assess the viability of an investment in Consti Corp. Macrille expects to hold the investment for five (5) years and sell it at the end of the holding period. Rachelle forecasted that Consti Corp. will pay the following dividends: Year Dividend per Share 5 P3.60 4 3.48 3 3.22 2 2.98 1 2.50 Rachelle expects that at the end of the third year, the selling price of the company's stock will be P125 per share. She also estimated that the cost of capital is 5%. The current…You are considering buying some share in The Wayne Coporation as part of your retirement account. First, you want to calculate the expected return for Wayne Corp's stock to see if it meets your very high standards. You have estimateed the 3 for Wayne Corp to be 2.38, the risk free rate in the market to be 2%, and the expected return on the market to be 20. What is the expected return for Wayne Corp? (Answer in Percentage terms and Round to 2 decimals)2. Suppose you buy shares of a stock worth OMR20000 and the initial margin is 50% and the maintenance margin is 30%. A. How much money must you pay the broker for the shares? How much have you borrowed from the broker? B. Suppose the price of the stock falls so that the shares are only worth OMR10000. What would be your nev account equity? C. How much money you need to give the broker to meet the maintenance margin?
- Wendy wants to use the money in her savings account to buy shares in her favourite company. a Explain why the number of shares she can buy is inversely proportional to the share price. b The share price is currently £6.25, and Wendy can buy n shares at that price. i If the share price drops by £0.15, how many shares can Wendy now buy? ii By what percentage must the share price fall so that Wendy can buy 1.5n shares?Suppose you purchase one share of the stock of Red Devil Corporation at the beginning of year 1 for $43.00 At the end of year 1, you receive a dividend of $2, and buy one more share for $47.00. At the end of year 2, you receive total dividends of $4 (e., $2 for each share), and sell the shares for $55.00 each. What is the time-weighted return on your investment? (Round your answer to 2 decimal places. Do not round intermediate calculations.) Return 1%Suppose you bought XYZ stock 1 year ago for $6.54 per share and sell it at $2.79. You also pay a commission of $0.35 per share on your sale. What is the total return on your investment? The total return is %?
- You want to purchase some shares of Eagle Landers stock but need a 11 percent rate of return to compensate for the perceived risk of such ownership. What is the maximum you are willing to spend per share to buy this stock if the company pays a constant $0.84 annual dividend per share? You must use the financial calculator to solve this question and please leave at least 2 decimal places.You purchase 1,000 shares of WMT (Walmart) for $143 per share. A year later, you sell the stock for $166 per share. You receive a dividend of $2.27 a share. a.What is your total dollar return? b. What are your dividend yield, capital gain yield, and total percentage return? Note: don't use chat gpt.4. Steve has received a stock tip from Monica. Monica has told him that XYZ Corp. will increase in value by 100%. Steve believes that Monica has a 25% chance of being correct. If Monica is incorrect, Steve expects the value of XYZ Corp. will fall by 50%. What is Steve's expected utility from buying $1,000 worth of XYZ Corp. stock? Steve's utility of income is U(I)=501 Should Steve purchase the stock?
- Assuming yourself to be Anna, narrate what you would have read in the file. Your narrative should include answers to the following: Note: 1 Retention ratio = 1 – Dividend payout ratio a) If after changing the dividend policy to a 70% payout, Chatterbox grows at a 3% rate, what would be the implied ACTUAL return on equity and stock price? Does the stock price rise or fall? Why?Suppose you purchase one share of the stock of Cereal Correlation Company at the beginning of year 1 for $35. At the end of year 1, you receive a $3 dividend, and buy one more share for $44. At the end of year 2, you receive total dividends of $6 (i.e., $3 for each share), and sell the shares for $50 each. The time-weighted return on your investment is? When performing the calculations, do not round any inputs or interim results until you get the final answer. Round your final answer to four places after the decimal point. The dollar-weighted return on your investment is? When performing the calculations, do not round any inputs or interim results until you get the final answer. Round your final answer to four places after the decimal point.Cost of equity: SML. Stan is expanding his business and will sell common stock for the needed funds. If the current risk-free rate is 3.4% and the expected market return is 9.9%, what is the cost of equity for Stan if the beta of the stock is a. 0.65? b. 0.81? с. 1.09? d. 1.34? a. What is the cost of equity for Stan if the beta of the stock is 0.65? % (Round to two decimal places.)