Clearview Productions is a publicly held company whose common stock has recently been selling for $ 50 00 a share The firm is expected to pay an annual cash dividend of $ 5 00 a share next year, and the firms investors anticipate an annual rate of return of 15 a If the firm is expected to provide a...

a Clearview has estimated its cost of equity to be 15 percent and wants to ...

Clearview Productions is a publicly held company whose common stock has recently been selling for $ 50.00

Question:

Clearview Productions is a publicly held company whose has recently been selling for $ 50.00 a share. The firm is expected to pay an annual cash of $ 5.00 a share next year, and the firm’s investors anticipate an annual rate of return of 15%.
a. If the firm is expected to provide a constant annual rate of growth in dividends, what is that growth rate?
b. If the risk- free rate of interest is 3% and the market risk premium is 6%, what must the firm’s beta be to warrant a 15% expected rate of return on the firm’s stock? Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...