What is the expected rate of return on this stock

Assignment Help Accounting Basics
Reference no: EM133017681

Questions -

Q1. Mai owns shares of Delt Productions preferred stock which she says provides her with a constant 14.3 % rate of return. The stock is currently priced at $45.45 a share. What is the amount of the dividend per share?

Q2. Roadside, Inc. preference shares pays a dividend of $7.50 per share semiannually and sells for $59.70 a share. What is your effective annual expected rate of return if you purchase the shares at the market price?

Q3. Sunny Co. paid $2.8 dividends last year. The dividend is expected to grow at a rate of 4% per year. How much would Sunny's share be worth if the investor requires 12% rate of return?

Q4. Sharp Co. Ordinary shares are currently selling for $11.25 each. Recently the company paid a dividend of $0.8 for each ordinary share. If the dividends are expected to grow at a rate of 5% per year. What is the expected rate of return? If you require a rate of return of 10%, should you invest in the company's ordinary shares? Should you purchase the company's ordinary shares if your required rate of return is 10%.

Q5. Miller Brothers Hardware paid an annual dividend of $1.15 per share last month. Today, the company announced that future dividends will be increasing by 2.6 percent annually. If you require a 12 percent rate of return, how much are you willing to pay to purchase one share of this stock today?

Q6. Fast Motion Co. paid a $2.20 per share annual dividend last week. Dividends are expected to increase by 3.75 percent annually. What is one share of this stock worth to you today if your required rate of return is 15 percent?

Q7. The common stock of Red Mills pays an annual dividend of $1.65 a share. The company has promised to maintain a constant dividend even though economic times are tough. How much are you willing to pay for one share of this stock if you want to earn a 12 % annual return?

Q8. The common stock of Fast Deliveries sells for $28.16 a share. The stock is expected to pay $1.35 per share next year when the annual dividend is distributed. The firm has established a pattern of increasing its dividends by 3 % annually and expects to continue doing so. What is the expected rate of return on this stock?

Reference no: EM133017681

Questions Cloud

Prepare consolidation worksheet adjustments for year ended : The original cost of the P & E was $2,800,000 and accumulated depreciation was $800,000. Prepare consolidation worksheet adjustments for year ended
Determine the Dell total asset turnover : Dell had net sales of $35,404 million. Its average total assets for the period were $14,502 million. Determine the Dell's total asset turnover
How many shares must be sold : The share currently sells for $8.00 and there are 150 million shares outstanding. How many shares must be sold if the subscription price is $7.50
Why do states give foreign aid : Why do states give foreign aid? What are the economic/moral bases for giving aid and How have foreign aid and security been linked? What have been the consequen
What is the expected rate of return on this stock : The stock is expected to pay $1.35 per share next year when the annual dividend is distributed. What is the expected rate of return on this stock
What is the spending variance related to shipping expenses : The planning budget for March was based on producing and selling 19,000 units. What is the spending variance related to shipping expenses
Evidence of applied theory and best practice : Evidence of practical insight coupled with solid theoretical underpinnings: evidence of the application of material in the prescribed texts to the case
Calculate the cost of goods sold and the interest expense : Dividends paid to preferred and common stockholders = $2,700,000. Calculate the cost of goods sold and the interest expense
How much is bad debt expense will carl collectibles report : Carl's Collectible computes a total of $8,120 in estimated losses as of December 31, 2021. How much is bad debt expense will Carl Collectibles report

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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