Investor required rate of return-stock is currently trading

Assignment Help Financial Management
Reference no: EM13765436

A stock current dividend is $1.00 and its expected dividend is $1.10 next year. If the investor required rate of return is 15% and the stock is currently trading at $20.00. What is the implied expected price in one year?

A. 22.00

B. 21.90

 

C. 23.00

Reference no: EM13765436

Questions Cloud

How was hamlet a tragic hero : How was Hamlet a tragic hero?
What is conundrums expected current share price : Conundrum Mining is expected to generate $12 million, $18 million, $22 million and $26 million in free cash flows over the next four years, after which they are expected to grow at a rate of 5% per year. If the weighted average cost of capital is 12%..
Downsizing and the expansion the firm oversees : The focus on core competencies seems to mandate both a downsizing and the expansion the firm oversees. Is this a contradiction? (Hint: Discuss the concept of core competencies and then show how spreading a business across boarders expands the gains f..
What methodologies are used in study published by nguyen : What methodologies are used in the study published by LeBlanc and Nguyen (1999)? List them. Identify the procedure that was followed for sample selection as well as the sample size.
Investor required rate of return-stock is currently trading : A stock current dividend is $1.00 and its expected dividend is $1.10 next year. If the investor required rate of return is 15% and the stock is currently trading at $20.00. What is the implied expected price in one year?
Why it is necessary to choose appropriate data types : Why it is necessary to choose appropriate data types for each data column. How must a database designer balance the time to complete data modeling steps with the benefits the data modeling process offers in creating
Determine the optimal number of currencies : How would you go about determine the optimal number of currencies in the world? In a region like Europe? Within a country like the United States? Describe your approach to the issue, and use your analytical framework to compare the appropriateness of..
Withholdings and employer matching : The employees of the Chop House earned gross salaries of $45,000 during January. The company complied with the law regarding employees' withholdings and employer matching.
What is the net present value of this investment : An orcharder spends $100,000 to planet pomegranate bushes. It will take four years for the bushes to provide a usable crop. He estimates that every year for 20 years after that he will receive a crop worth $9,500 per year. If the discount rate is 9%,..

Reviews

Write a Review

Financial Management Questions & Answers

  Prepare swag''s consolidated balance sheet

Prepare Swag's consolidated balance sheet under and prepare the consolidated financial statements for 20X3 using the direct method

  Implication of efficiency market theory for financial policy

Explain the three different forms of the efficient markets hypothesis and discuss some of the implications of efficiency market theory for corporate financial policy.

  What is the projects NPV

A project has an initial cost of $41,125, expected net cash inflows of $12,000 per year for 9 years, and a cost of capital of 14%. What is the project's NPV? (Hint: Begin by constructing a time line.) Do not round your intermediate calculations. Roun..

  Exotic cuisines employee stock optionsas a newly minted mba

exotic cuisines employee stock optionsas a newly minted mba youve taken a management position with exotic cuisines inc.

  Describe vernons product life-cycle theory of fdi

Describe Vernon's product life-cycle theory of FDI

  What is EAR implied in each option

Suppose you plan to borrow $10000 from the bank and have two options to pay back: What is EAR implied in each option? Which one do you prefer and explain why?

  Discuss any trends in the net cash

Discuss any trends in the net cash provided in operating, investing and financing activities for Home Depot and Lowes in FYE2008 and compare the liquidity, solvency, and profitability of Home Depot and Lowes' to draw conclusion on the financial man..

  What is the expected return on the mutual fund

Consider the following capital market: a risk-free asset yielding 0.75% per year and a mutual fund consisting of 70% stocks and 30% bonds. The expected return on stocks is 10.75% per year and the expected return on bonds is 3.25% per year. What is th..

  Stock analysis - calculate the required rate of return

The purpose of this project is to familiarize you with the stock market - calculate the required rate of return on your stock using CAPM:BAD 350- Managerial Finance

  Calculate the options exercise value

Calculate the options exercise value? What is the significance of this value and why is an investor willing to pay more than the exercise value for the option

  What is expected return–beta relationship in this economy

Suppose that there are two independent economic factors, F1 and F2. The risk-free rate is 9%, and all stocks have independent firm-specific components with a standard deviation of 49%. What is the expected return–beta relationship in this economy?

  What was the restructuring accrual associated

Cranberry Chemical recorded pre tax restructuring charges of $1378 million in 2014. The charges consisted of asset write-downs of $908 million, costs associated with exit or disposal activities of $132 million, and employee severance costs of $338 mi..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd