#5 Suppose the risk-free rate is 1.91% and an analyst assumes a market risk premium of...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
#5 Suppose the risk-free rate is 1.91% and an analyst assumes a market risk premium of 7.95%. Firm A just paid a dividend of $1.48 per share. The analyst estimates the B of Firm A to be 1.48 and estimates the dividend growth rate to be 4.51% forever. Firm A has 270.00 million shares outstanding. Firm B just paid a dividend of $1.53 per share. The analyst estimates the B of Fim B to be 0.74 and belleves that dividends will grow at 2.82% forever. Firm B has 199.00 million shares outstanding. What is the value of Firm B? Submit Answer format: Currency: Round to: 2 decimal places. #5 Suppose the risk-free rate is 1.91% and an analyst assumes a market risk premium of 7.95%. Firm A just paid a dividend of $1.48 per share. The analyst estimates the B of Firm A to be 1.48 and estimates the dividend growth rate to be 4.51% forever. Firm A has 270.00 million shares outstanding. Firm B just paid a dividend of $1.53 per share. The analyst estimates the B of Fim B to be 0.74 and belleves that dividends will grow at 2.82% forever. Firm B has 199.00 million shares outstanding. What is the value of Firm B? Submit Answer format: Currency: Round to: 2 decimal places.
Expert Answer:
Related Book For
Auditing An International Approach
ISBN: 978-1259087462
7th edition
Authors: Wally J. Smieliauskas, Kathryn Bewley
Posted Date:
Students also viewed these accounting questions
-
Q5 (1pt) A bacterial cell has a solute concentration of 0.78%. Which of the following levels of solute concentration would the cell prefer to have as an external environment? a. a 0.90% solution of...
-
The risk free rate of interest on government securities in 2013 is 7.3% Required: Prepare a report for the directors of In Style Pty. Ltd assessing its: a) Profitability. b) Efficiency. |2013 |2012 y...
-
Suppose the following conditions hold. The risk free rate is 4% and the market risk premium is 6%. We have a portfolio containing three stocks and a risk-free asset. We have $50 of the risk-free...
-
Silverago Incorporated, an international metals company, reported a loss on the sale of equipment of $2 million in 2010. In addition, the companys income statement shows depreciation expense of $8...
-
Blake Corporation acquired 100 percent of Shaw Corporation's voting shares on January 1, 20X3, at underlying book value. At that date, the book values and fair values of Shaw's assets and liabilities...
-
For each of the following linear programming models, give your recommendation on which is the more efficient way (probably) to obtain an optimal solution: by applying the simplex method directly to...
-
Mann Company was organized on March 1 of the current year. Projected sales for each of the first three months of operations are as follows: The company expects to sell 20% of its merchandise for...
-
During December, Western Solvent completed 40,000 units. At the end of December, there were 10,000 units in ending Work in Process that were 30 percent complete with respect to labor and overhead and...
-
Each of the following items must be considered in preparing a statement of cash flows (indirect method) for Turbulent Indigo Inc. for the year ended December 31, 2025. State where each item is to be...
-
Cindy Jos Hair Salon is concerned about their rising costs of supplies, energy and labor, so they are considering investing in better equipment, which hopefully will reduce the time required to...
-
Best Aviation Associates is a general partnership engaged in the business of buying, selling and servicing used airplanes. Best's original partners were Martin and Kent. They formed the partnership...
-
b) Find the errors in the following two functions. Briefly explain how each may be remedied. void max (a, b) { int a,b; if (a>b) else return a; return b; void test (int) { int i; for(i=1; i
-
The company name is iTechskills. Website : https://itechskills.ca/ Please elaborate or explain : Company highlights: watershed event, summarized history, or any description of the company's reason...
-
I need help finding articles. Can you please link them? Anything related to school counseling or counseling with kids. Anything in the last seven years These are the topics a. Importanceof Openness...
-
(a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (1) Earnings per share Return on common stockholders' equity Return on assets Current ratio Accounts receivable turnover Average collection period...
-
Required: 1. Compute the predetermined overhead rate. 2. During the year, Tech Solutions started and completed the Xavier Company engagement. The following information was available with respect to...
-
Beckwith has sales of $930,000 and cost of good solds of $590,000. The firm had a begining inventory of $41,000. What is the length of the inventory period
-
Read Case Study Google: Dont Be Evil Unless and answer the following: Given its mission of providing information to the world, should Google censor searches in China?
-
What are two causes of misstatements?
-
What does the concept reasonable assurance refer to? How does it relate to information risk reduction?
-
Use the critical thinking framework to help resolve the confidentiality versus misleading financial statements conflict discussed in this chapter.
-
Folk Landscaping is evaluating an offer to purchase Bruce Lawn Care, its main competitor, for \($250,000.00.\) An accountant has projected that the purchase will increase Folks annual net cash flow...
-
How much do we need to invest each year to have \($100,000.00\) in a college fund when our child turns 18 years old? New parents often seek similar advice from their financial advisors to establish...
-
Forester Company is evaluating the purchase of equipment from two vendors. Differences in the technology and labor requirements to operate the equipment of each vendor affect the projected net cash...
Study smarter with the SolutionInn App