According to the dividend growth model

Assignment Help Financial Management
Reference no: EM131562424

1. According to the dividend growth model, the required rate of return is equal to the capital gains yield if the dividend growth rate is ______.

2. Assume a constant dividend growth. A decrease in the capital gains yield will ______ the current value of a stock.

3. _______________ can be used to value the stock of firms that pay no dividends.

Reference no: EM131562424

Questions Cloud

Aftertax cost of debt and pretax cost of debt : What is the pretax cost of debt? Which is more relevant, the pretax or the aftertax cost of debt? What is the aftertax cost of debt?
An unexpected decrease in corporate tax rates is an example : A group of assets held together by an investor is referred to as a __________. An unexpected decrease in corporate tax rates is an example
Compute shareholder tax rate : Compute shareholder’s tax rate when corporate tax rate is 35% and the dividend tax is 15%.
What is the economic life of this challenger : What is the economic life of this challenger? What is the EUAC corresponding to the economic life in part a?
According to the dividend growth model : According to the dividend growth model, the required rate of return is equal to the capital gains yield if the dividend growth rate is ______.
The texas state pension fund : You represent the Texas State Pension Fund. What is the total fee percentage paid in the final year? What your ending balance?
Bond rating degraded to junk status : Ford Motor Corporation has recently had its bond rating degraded to “Junk” status.
Define the euro : The euro is
What is market sentiment : What is market sentiment? How is it calculated using mutual funds, ETF's and other portfolio based investment choices?

Reviews

Write a Review

Financial Management Questions & Answers

  What is the effective annual rate of interest

The terms of the sale were 4/9, net 36. What is the effective annual rate of interest?

  Initial fixed asset investment

Consider a four-year project with the following information: initial fixed asset investment = $430,000; straight-line depreciation to zero over the four-year life; zero salvage value; price = $24; variable costs = $16; fixed costs = $120,000; quantit..

  What is the companys required return

CAPM Required Return A company has a beta of .69. If the market return is expected to be 13.9 percent and the risk-free rate is 5.95 percent, what is the company's required return?

  What are the year three cash flows

Net Cash Flows year 3: Replace old asset that cost $30,000 with new asset that costs $80,000 and will be depreciated on a 7 year MACRs table. Old asset has book value of $10,000 and will sell for $4,000. Old asset was being depreciated straight line ..

  Company return on equity

Calculate the company's return on equity and explain whether the managers are providing a good return on the capital provided by the company's shareholders. Diagram and explain the operating cycle of a service company.

  What should the price per share be

Preferred stock has a dividend of $12 a year. The required return is 6%. what should the price per share be?

  What is the expected rate of return on shares

XYZ Inc. has an 11.5% equity return and retains 55% of its earnings for re-investment purposes. What is the expected rate of return on XYZ shares?

  Calculate the net present value for each project

Calculate the net present value for each project. Does the new assumption change the investment decision?

  Present value of series of cash flows

What happens to the present value of a series of cash flows (increase or decrease) as the number of payments (length of time) increases, holding all other factors constant? Does the change occur at a constant rate or at a varying rate? How do we hand..

  What will be resulting percentage change in ebit

The Poseidon Swim Company produces swim trunks. What will be the resulting percentage change in EBIT if they expect units sold to changes by 2.9 percent?

  Calculate the average price at which the shares were issued

Common stock without par value, 1,500,000 shares authorized, 600,000 shares issued, and 540,000 shares outstanding - $8,700,000. Calculate the average price at which the shares were issued. What accounts for the difference between issued shares and o..

  Develop the total cost characteristic of the composite

Develop the total cost characteristic of the composite.- Determine the economic operating point for these three units when delivering a total of 850 MW.

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