Question: Paccar s current stock price is $ 7 0 . 2 4 and it is likely to pay a $ 2 . 9 4 dividend

Paccars current stock price is $70.24 and it is likely to pay a $2.94 dividend next year. Since analysts estimate Paccar will have an 8.5 percent growth rate, what is its required return? (Round your answer to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

1. Which of the following is a potential cost of the public disclosure of accounting information? a. Loss of competitive advantage caused by revealing information to competitors. b. Potential...

Q:

1. Consider a firm that had been priced using a 10 percent growth rate and a 12 percent required return. The firm recently paid a $1.20 dividend. The firm just announced that because of a new joint...

Q:

1. Which of these statements is true? When people purchase a stock, they do not know what their return is going to beeither short term or in the long run. When people purchase a stock, they know the...

Q:

1. The average annual return on an Index from 1986 to 1995 was 16.70 percent. The average annual T-bill yield during the same period was 5.90 percent. What was the market risk premium during these...

Q:

Universal Forest's current stock price is $74.00 and it is likely to pay a $0.34 dividend next year. Since analysts estimate Universal Forest will have a growth rate of 9.4 percent, what is its...

Q:

QUESTION 21 If on November 27, 2017, The Dow Jones Industrial Average closed at 12,958.44, which was up 215.04 that day. What was the return (in percent) of the stock market that day? 1. +0.017...

Q:

1 . Expected Return A company's current stock price is $ 8 5 . 3 0 and it is likely to pay a $ 4 . 3 0 dividend next year. Since analysts estimate the company will have a 1 0 % growth rate, what is...

Q:

1 . Expected Return A company's current stock price is $ 8 5 . 3 0 and it is likely to pay a $ 4 . 3 0 dividend next year. Since analysts estimate the company will have a 1 0 % growth rate, what is...

Q:

A manager believes his firm will earn a 14 percent return next year. His firm has a beta of 1.5, the expected return on the market is 12 percent, and the risk-free rate is 4 percent. Determine...

Q:

Lnder wood Univers canvas D student Portal Login LU EMail McNNECT connect 7 CH 09 Characterizing Risk&Retum, CH 10 Estimating Risk&Return Question 10 (of 11) value: 3.00 points Suppose Paccar's...

Q:

1.) If the risk-free rate is 7.40 percent and the risk premium is 6.4 percent, what is the required return? (Round your answer to 1 decimal places.) 2.) If the risk-free rate is 5.50 percent and the...

Q:

Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales $...

Q:

A fuel rod of a PWR consists of about 320 solid fuel pellets inside a zircaloy cladding. Use the specified data to plot the distribution of temperature in the fuel rod. The temperature distribution...

Q:

How do you carry out a case study research design? Compare the approaches of Hartley (1994) and McCutcheon and Meredith (1993).

Q:

last two options for the multiple choice are : performance management development A construction equipment manufacturer, Roswell Corporation, is focusing on becoming a leader in sustainability in...

Q:

Family- friendly benefi ts may be attractive to staff but have disadvantages to employers. Select three of the benefi ts detailed in this chapter, list the disadvantages that may accompany...

Q:

here) and other areas you consider relevant.

Q:

Using the example of the testing for pub landlords in case study 3.2, draw up a list of specialist positions where the use of tests may produce some interesting personality profi les.