Determine the dividend yield and current stock price, Microeconomics

The Bloomington Electric Company operates in a stable industry and therefore has predictable dividend growth of 8% per year. The most recent annual dividend was paid yesterday in the amount of $4. Assume the appropriate discount rate is 15%.

a. what is the current stock price?

b. Assuming the annual growth rates for the next three years is 20% each year; but starting the fourth year and after the growth rate remains constant at 8%. What is the current stock price under this scenario?

c. Assuming a dividend growth rate of 8%, what is the dividend yield of this stock if the current stock price is $40?

Posted Date: 3/2/2013 2:25:18 AM | Location : United States







Related Discussions:- Determine the dividend yield and current stock price, Assignment Help, Ask Question on Determine the dividend yield and current stock price, Get Answer, Expert's Help, Determine the dividend yield and current stock price Discussions

Write discussion on Determine the dividend yield and current stock price
Your posts are moderated
Related Questions
Q. Market Income and Socialism? Market Income: A household's total pre-tax income obtained from its activities in formal economy, including salaries andwages, investment income

Use standard indifference curve analysis to demonstrate whether the following statement is true or false. If the objective of government welfare programs is to provide lower inc

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Measured cell emf are the basis for standard electrode potentials. chemistry assignments A method for the presentation of the data obtained from measurements of the equilibrium

Summarize the four supply factors in economic growth.

1.  Seller has ample time to adjust to price change. 2.  Buyer's response to small price change is significant. 3.  Buyers are faced with many options when deciding to make a

Under capitalism, most production is undertaken by private companies (of various forms), with the goal of generating a profit to the company's owners. Profit is obtained when compa

dicuss the relevance of studing production theory and analysis inn your career as a student of manegerial economics


Price: The price factor is another important variable to be included in demand analysis. Here one has to consider the prices of the product and also its substitute and complement