Big Rock is listed on the local stock exchange and its stock has had mixed performance over the last few months. The company's directors are interested in seeing how Big Rock's performance compares to other companies in the sector. Value End of Year 1 $1,268 Value End Value End of Year 2 $1,334 Company Initial of Year 3 $1,105 Investment Big Rock Building Inc. $1,000 Required: Calculate the arithmetic mean and the geometric mean over the three-year period for the investments made.
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- 1).Big Rock is listed on the local stock exchange and its stock has had mixed performanceover the last few months. The company’s directors are interested in seeing how BigRock’s performance compares to other companies in the sector. Company Initial Investment Value End of Year 1 Value Endof Year 2 Value Endof Year 3Big Rock Building Inc. $1,000 $1,268 $1334 $1,105 Required: Calculate the arithmetic mean and the geometric mean over the three-yearperiod for the investments made. 2).The company’s pension plan is managed by Castle Fund Managers, a leading provider ofpension services. It is a defined contribution plan, where the employees’ contributions arematched by the employer. Each employee had to choose one of the following investmentoptions for their individual plans: a. Preferred Accumulator (PA): Short-term focusb. Balanced Accumulator (BA): Medium-term focusc. Select…Question A .Consider the following firms: Net Income this Year Stock price at beginning of year Stock price at end of year Firm A $ 10,000,000 $ 20 $ 10 Firm B $ 8,000,000 $ 10 $ 20 a) The manager of firm A is doing a better job than B b) The manager of firm B is doing a better job than A c) Neither manager is doing a good job d) Both managers are doing a good job Full explain this question and text typing work only We should answer our question within 2 hours takes more time then we will reduce Rating Dont ignore this lineq4- Gamma Ltd's net profit for the last financial year was $179,000 and it paid $113,000 in dividends. It expects net profit to grow at 2.6% p.a. in perpetuity and to maintain a constant dividend payout ratio. Its beta is 1.9, the risk-free rate is 2.1% and the equity risk premium is 6.8%. What is its justified forward P/E/ ratio? a. 5.08 b. 2.97 c. 3.05 d. 5.21 Clear my choice
- Dont use excel please DIRECTIONS: Compute the requirements of each problem. All computations must be handwritten. A. HYZEL Corporation, a domestic corporation, is expected to distribute P1.50 cash dividends at the end of the year. It is forecasted that the dividends will grow at a constant rate of 7% a year. The required rate of return of the common stock of HYZEL is 12.6%, Required: Using the constant growth stock valuation model, compute the current value per share where D1 = P1.50 B. IZZY Company paid dividends to its common stockholders at P2.75 per share on December 31, 2018. The common stock of IZZY is selling in the market at P67.90 per share. The dividend growth rate of the company is 5.6% and the required rate of return of the common stock is 7.5%. Required: 1. Using the discounted dividend model, how do you compute the market price of the common stock? 2. Will an investor consider buying the common stock of IZZY at 963.90 per share?Please provide solutions. Thank you. 1. A firm has common stock with a prevailing market price of P100 per share. New issue of stock is expected to be sold for P98, with P2 per share representing the under-pricing necessary in the competitive capital market. Flotation costs are expected to total P1 per share. The dividends paid on the outstanding stock over the past five years are as follows: Year Dividend1 P4.002 4.283 4.584 4.905 5.24 The cost of the firm’s new common stock equity is?QUESTION 1. The current year profits of Levelex Inc. is 1.000.000₺ and expected profits for thenext year is 1.250.000₺. The average profitability of its assets is 22% and the current year dividend per face valueof 1₺ is 30%.a) Compute the intrinsic value of a stock of this company for an investor whose minimum required rate ofreturn is 25 %. b) Compute the value of this stock under the same assumptions 2 years later.
- Question Please provide the solutions and the correct answers. thank you! 2. The Delta Company projects the following for the upcoming year: Earnings before interest and taxes = P40 millionInterest expense = P 5 millionPreferred stock dividends = P 4 millionCommon stock dividend payout ratio = 20%Average number of common shares outstanding = 2 millionEffective corporate income tax rate = 40% The expected dividend per share of common stock isa. P1.70b. P1.86c. P2.10d. P1.00 3. Following are selected data taken from the records of Jemson Company:Income before tax = P200,000Income tax rate = 40%Dividend payout ratio = 0.80Number of common shares outstanding = 10,000 shares How much dividends per share did the company pay during the year?a. P9.60b. P6.40c. P16d. P15Q-r Net income for the previous year was $400,000, of which $280,000 was paid out in dividends. Dividends are expected to grow at a constant rate. The company has 200,000 shares outstanding and the book value of equity is $4,000,000. The appropriate P/E ratio for this type of company is 8. What is the expected stock price 5 years from now?Subject: Financial strategy & policy Q.2) Bowles Sporting Inc. is prepared to report the following income statement (shown in thousands of dollars) for the year 2009. Sales $15,200 Operating costs including depreciation (11,900) EBIT $ 3,300 Interest (300) EBT $ 3,000 Taxes (40%) (1,200) Net income $ 1,800 Prior to reporting this income statement, the company wants to determine its annual dividend. The company has 500,000 shares of stock outstanding, and its stock trades at $48 per share. d) As an alternative to maintaining the same dividend payout ratio, Bowles is considering maintaining the same per-share dividend in 2009 that it…
- If a firm has retained earnings of $3.4 million, a common shares account of $5.4 million, and additional paid-in capital of $10.8 million, how would these accounts change in response to a 10 percent stock dividend? Assume market value of equity is equal to book value of equity. (Enter your answers in dollars not in millions. Input all amounts as positive values. Indicate the direction of the effect by selecting "increase," "decrease," or "no change" from the drop-down menu.)Q2: Pak China Railroad reported net income of $770 millionafter interest expenses of $320 million in a recentfinancial year. (The corporate tax rate was 36%.) It reporteddepreciation of $960 million in that year, and capitalspending was $1.2 billion. The firm also had $4 billionin debt outstanding on the books, was rated AA (carryinga yield to maturity of 8%), and was trading at par(up from $3.8 billion at the end of the previous year).The beta of the stock is 1.05, and there were 200 millionshares outstanding (trading at $60 per share), witha book value of $5 billion. Union Pacific paid 40% of itsearnings as dividends and working capital requirementsare negligible. (The Treasury bond rate is 7%.) Estimate the value of equity and the value per share now.Q2: Pak China Railroad reported net income of $770 millionafter interest expenses of $320 million in a recentfinancial year. (The corporate tax rate was 36%.) It reporteddepreciation of $960 million in that year, and capitalspending was $1.2 billion. The firm also had $4 billionin debt outstanding on the books, was rated AA (carryinga yield to maturity of 8%), and was trading at par(up from $3.8 billion at the end of the previous year).The beta of the stock is 1.05, and there were 200 millionshares outstanding (trading at $60 per share), witha book value of $5 billion. Union Pacific paid 40% of itsearnings as dividends and working capital requirementsare negligible. (The Treasury bond rate is 7%.) Estimate the FCFF for the most recent financialyear. Do not use $ sign