What is the internal rate of return? (IRR)
a. 10.23 +/- 0.01%
b. 6.76 +/- 0.01%
c. 9.1 +/- 0.01%
d. 8.31 +/- 0.01%
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, d. 8.31 +/- 0.01%
Math/Excel...
No foickin clue
Greeno grass cutters will pay $2 per share dividend next year and will increase the
dividend by 5% in perpetuity. If investors require a 13% rate of return what will the
theoretical price of a share of Cutters be in 5 years?
a. $33.50 +/- $0.02
b. $31.91 +/- $0.02
c. $25.00 +/- $0.02
d. $15.38 +/- $0.02
Give this one a try later!
b. $31.91 +/- $0.02
Math...
1. $2*(1+5%)^5 =
$2.552563
2. $2.55/ (13%-5%)
=$31.907
A firm's common stock is currently selling for $18 per share. The dividend expected to
be paid at the end of the coming year is $1.49. It's dividend payments are expected to
grow at 3%. It is expected that to sell, a new common stock issue must be
underpriced $1 per share in flotation costs. Additionally, the firm's marginal tax rate is
40 percent. The firm's cost of a new issue of common stock is ______ percent.
Give this one a try later!
a. 10.23 +/- 0.01%
b. 6.76 +/- 0.01%
c. 9.1 +/- 0.01%
d. 8.31 +/- 0.01%
Give this one a try later!
, d. 8.31 +/- 0.01%
Math/Excel...
No foickin clue
Greeno grass cutters will pay $2 per share dividend next year and will increase the
dividend by 5% in perpetuity. If investors require a 13% rate of return what will the
theoretical price of a share of Cutters be in 5 years?
a. $33.50 +/- $0.02
b. $31.91 +/- $0.02
c. $25.00 +/- $0.02
d. $15.38 +/- $0.02
Give this one a try later!
b. $31.91 +/- $0.02
Math...
1. $2*(1+5%)^5 =
$2.552563
2. $2.55/ (13%-5%)
=$31.907
A firm's common stock is currently selling for $18 per share. The dividend expected to
be paid at the end of the coming year is $1.49. It's dividend payments are expected to
grow at 3%. It is expected that to sell, a new common stock issue must be
underpriced $1 per share in flotation costs. Additionally, the firm's marginal tax rate is
40 percent. The firm's cost of a new issue of common stock is ______ percent.
Give this one a try later!
