QUESTION 14:

Glenhill Co. is expected to maintain a constant 5.6% growth rate in its dividends indefinitely. If the company has a dividend yield of 7.4%, what is the required return on the company's stock? (Round the final answer to 2 decimal places.)

Required return___________ %

QUESTION 15:

An investment has an installed cost of $523,800. The cash flows over the four-year life of the investment are projected to be $225,850, $242,450, $209,110, and $157,820.

If the discount rate is zero, what is the NPV? (Omit $ sign in your response.)

NPV _________________$

If the discount rate is infinite, what is the NPV? (Negative answer should be indicated by a minus sign. Omit $ sign in your response.)

NPV__________________$

At what discount rate is the NPV just equal to zero? (Round the final answer to 2 decimal places.)

IRR_________________ %

QUESTION 16:

An investment under consideration has a payback of six years and a cost of $869,000. Assume the cash flows are conventional.

If the required return is 12%, what is the worst-case NPV? (Negative answer should be indicated by a minus sign. Do not round intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)

Worst-case NPV _____________________ $