A particular common stock has an annual cash dividend of $4 per share and is predicted to

Fantastic news! We've Found the answer you've been seeking!

Question:

A particular common stock has an annual cash dividend of $4 per share and is predicted to have a market value of $60 per share 5 years from now. Assuming a discount rate of 10%, a fair market price for the stock today is?

Related Book For answer-question

Financial Management Core Concepts

ISBN: 978-0132671033

2nd edition

Authors: Raymond M Brooks

See More Books

Posted Date: Sep 05, 2020 03:33 AM

See More Questions

Miles Hardware has an annual cash dividend policy that raises the dividend each year by 3%. Last years dividend was $1.00 per share. Investors want a 15% return on this stock. What is the stocks...
King Waterbeds has an annual cash dividend policy that raises the dividend each year by 4%. Last years dividend was $0.40 per share. What is the price of this stock if a. an investor wants a 5%...
Sia Dance Studios has an annual cash dividend policy that raises the dividend each year by 2%. Last years dividend was $3.00 per share. The company will be in business for forty years with no...
The Depression Anxiety Stress Scales (DASS) is a tool to measure the depression, anxiety and stress levels of individuals. For measuring the stress level, the DASS score ranges from 0 to 42 and a...
The following paired observations were obtained on two variables x and y: a. Calculate Spearman's rank correlation coefficient rs. b. Do the data present sufficient evidence to indicate a correlation...
How many kilograms of nickel must be added to 5.43 kg of copper to yield a solidus temperature of 1200(C?
Estimate the steady-state concentration profile when a typical albumin solution is subjected to a centrifugal field of 30000 times the force of gravity under the following conditions: the cell length...
Modern Fun Corporation sells electronic games. Its five salespersons are currently being paid fixed salaries of $30,000 each; however, the sales manager has suggested that it might be more profitable...
Calculate the key profitability ratios for the years 2002 to 2006(E). What is the trend in RoE from 2002 to 2006 (E)! List down at least one reason for the increase/decrease in RoE by assessing the...
Assistant police chief Todd Beck wants to analyze the citys historic crime data in order to better allocate police resources in the future. He collects data over the past two years. Each record in...
10. Calculating Present Values (LO2) Normandin Inc. has an unfunded Page 168 pension liability of $575 million that must be paid in 20 years. To assess the value of the firm's stock, financial...
What are the fiscal policy time lags evident in the news clip? People are expressing deep disappointment with the $600 Covid relief checks approved by Congress. The help is too little, too late, say...
Dyana Landrin was convicted of grand larceny after she admitted she took nearly $19,000 from the Community Mutual Savings Bank while she was employed as a teller. The county court ordered her to pay...
Which of the following items are sold by firms in monopolistic competition in a developed economy such as the United States? Explain your selection. Potato chips Air conditioner Television ...
What is the doctrine of employment-at-will?
On an international scale, Peloton has created and built a phenomenal brand with a cult-like following in just six years. The power of the brand lies in its ambition to be the Apple of fitness,...
finance Formula k p =W1k 1+ W2k^2+...+ Wnk^n where: kp W k^ n = expected return of portfolio the weight invested for each stock = expected return on ith stock = number of stocks in the portfolio ap =...
Calculate the electrical conductivity of a fiber-reinforced polyethylene part that is reinforced with 20 vol % of continuous, aligned nickel fibers.
The Fast-Track Co. has thus far only used equity to finance its operations and currently has 1,000,000 shares outstanding with an EBIT of $1,500,000. The newly-hired CFO firmly believes that the firm...
Bank A offers to pay you lump sum of $20,000 after 5 years, if you deposit $9,500 with them today. Bank B, on the other hand, says that they will pay you a lump sum of $22,000 after 5 years, if you...
Susan Norman seeks your financial advice. She wants to know how long it will take for her to become a millionaire. She tells you that she has $1,330 today and wants to invest it in an aggressive...
Determine the irrep content for the equivalent reducible $S_{3}$ representations $\Gamma^{(4)}$ and $\Gamma^{(5)}$ of Fig. 2.4 . Data from Fig. 2.4 F(1) (2) 1 (3) (4) r(5) (6) 1 0 0 0 0 0 0 1 0...
Prove that the direct product of two representations is a representation, and that the character of the direct product is the product of characters for the representations.
Demonstrate explicitly that for invariant subgroups the cosets form a group under the coset multiplication law (2.27).

A particular common stock has an annual cash dividend of $4 per share and is predicted to

Question:

Expert Answer:

Financial Management Core Concepts

Students also viewed these accounting questions