What is value of common stock-rate of return on the stock

Assignment Help Financial Management

Reference no: EM131334217

1. A stock has a beta of 1.1 and the expected return on the market is 13%. The risk-free rate is 4.2%. What is the rate of return on the stock?

2. Utility Company pays dividends of $15 per share annually. The dividend is expected to continue indefinitely forever. The rate of return on the bond is 7%. What is the value of the common stock?

a. $1.05

b. $46.67

c. $105

d. $214.29

Reference no: EM131334217

Questions Cloud

Decision making organizational behavior : A) A brief description of the decision and why you think it was a bad one B) What kind of bias you think lead to this decision, and why C) A reference to one of the background readings from this module

Is each paragraph organized around one key point : Is each paragraph organized around one key point? Do topic sentences clearly indicate the focus of each paragraph - Does the author support each main point with direct quotations from the poem that are analyzed and explained? Do you have any sugges..

Personal biases and pitfalls that can lead to bad decisions : Even the most intelligent manager is prone to personal biases and pitfalls that can lead to bad decisions. We all carry biases based on our personal experiences. And we can all fall into various traps that lead to decisions that seem perfectly log..

Example of related diversification : Which of the following is an example of related diversification?

What is value of common stock-rate of return on the stock : A stock has a beta of 1.1 and the expected return on the market is 13%. The risk-free rate is 4.2%. What is the rate of return on the stock? Utility Company pays dividends of $15 per share annually. The dividend is expected to continue indefinitely f..

Leader of the organization : Explain how you would have handled the situation if you were the leader of the organization. Suggest ways that leadership could have prevented this situation from happening.

Atmosphere conditions of wind speed : Question 1: Summarize the role that the atmosphere conditions of wind speed, temperature, and stability potentially impact plume modeling activities with a Gaussian model.

Create a professional letter for the sales position at apple : 1dentify all of the problems / errors with this letter and create a professional letter for the sales position at Apple.

Which one has the lowest degree of interest rate risk : Of the following bonds, which one has the lowest degree of interest rate risk? Larvey Co. has an unlevered cost of capital of 10.9 percent, a tax rate of 35 percent, and expected earnings before interest and taxes of $21,800. The company has $25,000 ..

User Account

All Pages