Yankee Athletic Club has preferred stock with a par value of $50 and an annual 6% cumulative dividend. Given the following prices for the preferred stock, what is each investor seeking for his or her return? a. Alex is willing to pay $40. b. Derek is willing to pay $30. c. Marcia is willing to pay $20. d. Johnny is willing to pay $15.
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Q: Yankee Athletic Club has preferred stock with a par value of $70 and an annual 6% cumulative…
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- Yankee Athletic Club has preferred stock with a par value of $100 and an annual 8% cumulative dividend. Given the following prices for the preferred stock, what is each investor seeking for his or her return? a. Alex is willing to pay $40. b. Derek is willing to pay $25. c. Marcia is willing to pay $20. d. Johnny is willing to pay $5.This is a complete question. Yankee Athletic Club has preferred stock with a par value of $70 and an annual 6% cumulative dividend. Given the following prices for the preferred stock , what is each investor seeking for his return? Please answer all questions (a-d) with explanations thx. What rate of return is each of them seeking if Alex is willing to pay $35, Derek is willing to pay $30, Marcia is willing to pay $15, and Jonny is willing to pay $5.Lahhey Publishing wishes to estimate the value of its outstanding preferred stock. The preferred stock has a RM50 par value and pays an annual dividend of RM7.50 per share and currently earning an 8% annual rate of return. (i) Calculate the market value of the outstanding preferred stock. (ii) If an investor purchases the preferred stock at the value calculated in part (a), how much does she gain or lose per share if she sells the stock when the required return on preferred stock has fallen to 6%. Explain.
- An investor with a required return of 14 percent for very risky investment in common stock has analyzed three firms and must decide which, if any, to purchase firm A B C current earnings $2.00 $3.20 $7.00 current dividend $1.0 $3.00 $7.50 expected annual growth rate in 7% 2% -1% dividends and earnings Current market price $23 $47 $60 what is the maximun price that investor should pay for each stock based on the dividend growth model? b. if the investor does buy stock A, what is the implied percentage return? c. if the appropiate P/E ratio is 12, what is the maximun price the investor should pay for each stock? would your answer be differeny if the appropiate P/E were 7? d. what…Jones Design wishes to estimate the value of its outstanding preferred stock. The preferred issue has a par value of $60 and pays an annual dividend of $5.60 per share. Similar-risk preferred stocks are currently earning an annual rate of return of 7.1%. a. What is the market value of the outstanding preferred stock? b. If an investor purchases the preferred stock at the value calculated in part a, how much does she gain or lose per share if she sells the stock when the required return on similar-risk preferred stocks has risen to 8.6%?Jones Design wishes to estimate the value of its outstanding preferred stock. The preferred issue has a par value of $70 and pays an annual dividend of $4.50 per share. Similar-risk preferred stocks are currently earning an annual rate of return of 11.5%. a. What is the market value of the outstanding preferred stock? b. If an investor purchases the preferred stock at the value calculated in part a, how much does she gain or lose per share if she sells the stock when the required return on similar-risk preferred stocks has risen to 13.2%? ______________________________________________________________________________ a. The market value of the outstanding preferred stock is $_________per share. (Round to the nearest cent.) b. If the required return on similar-risk preferred stocks has risen to 13.2%, the value of the stock will be $_______ per share. (Round to the nearest cent.) If an investor purchased the preferred stock at the value calculated in part…
- Fenway Athletic Club plans to offer its members preferred stock with a par value of $100 and an annual dividend rate of 7%. What price should these members be willing to pay for the returns they want? a. Theo wants a return of 8%. b. Jonathan wants a return of 11%. c. Josh wants a return of 15%. d. Terry wants a return of 18%.1. Lahhey Publishing wishes to estimate the value of its outstanding preferred stock. The preferred stock has a RM50 par value and pays an annual dividend of RM7.50 per share and currently earning an 8% annual rate of return. A. Calculate the market value of the outstanding preferred stock. B. If an investor purchases the preferred stock at the value calculated in part (a), how much does she gain or lose per share if she sells the stock when the required return on preferred stock has fallen to 6%. Explain.You own 300 shares of Finance Inc’s preferred stock which currently sells for $30.00 per share and pays annual dividends of $2.00 per share. i. What is the expected return? ii. If you require a 10% return, given the current price, should you sell or buy more stock
- You are planning to purchase 100 shares of preferred stock and must choose between stock A and stock B.Stock A pays an annual dividend of $4.50 and is currently selling for $35.Stock B pays an annual dividend of $4.25 and is currently selling for $36.If your required return is 12%, which stock should you use?Compute for the following problems. Show your solution. Assume you buy 100 shares of stock at Php40 per share on margin (40 percent). If the price rises to Php55 per share, what is your percentage gain on the initial equity? . In problem 1, what would the percentage loss on the initial equity be if the price had decreased to Php28? In 2015 Carlo Elise have several stocks that make-up his portfolio. Stock A with a price of P275.50 and shares outstanding of 2,500, for Stock B with a market value of P140,625.00 with 1,500 shares, for Stock C that has a market value of P279,450.00 at P155.25 and Stock D that has 150 shares outstanding with a market price of P475.00. In 2016, shares prices of Stock A and D go up by 20% while the others go down by a similar rate with additional purchase of 500 and 750 stocks for B and C respectively except for stock E that stays the same with a market value of P138,125 at 2,500 shares. a. How much is the total market value of the index for 2015? b. In…Assume that you own 1,500 shares of $10 par value common stock and the company has a 5-for-1 stock split when the market price per share is $30. What will probably happen to the market price per share of the stock and the par value per share of the stock? Multiple Choice A) Market price per share will be about $6 per share, and par value will be $2 per share. B) Market price per share will be about $6 per share, and par value will be $50 per share. C) Market price per share will be about $150 per share, and par value will be $2 per share. D) Market price per share will be about $150 per share, and par value will be $50 per share.
