Zachary purchased BBC stock expecting the price to rise 15% in the coming year. After one year, BBC stock has actually moved up by 30%, due primarily to new information released during the year concerning unexpectedly higher sales. Which of the following describes this result?
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23-
Zachary purchased BBC stock expecting the price to rise 15% in the coming year.
After one year, BBC stock has actually moved up by 30%, due primarily to new information released during the year concerning unexpectedly higher sales.
Which of the following describes this result?
26-
Talal acquired 1,200 shares of CRAZY SPORTS stock at a price of $40 per share.
Exactly one year later, he sold the shares for $43 per share. In addition, CRAZY SPORT paid a quarterly dividend of $0.50 per share at the end of each quarter.
What is the percent
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- 15- The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet. Estimate the long-term dividend yield based on the firm’s financial and operational performance based on the absolute approach and round to 2 decimals. Long-term dividend yield:20 - The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet. If the firm's ROE is forecast to decline to 8% in the future due a change in industry conditions, the firm's long term PE multiple would be expected to: Increase Decrease Remain unchanged. There is not enough information to answer the question. None of the above answers is correct.16 - The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet Estimate the long-term growth rate for the firm’s EPS, cash flow, and dividends based on the absolute approach and round to 2 decimals. Long-term growth rate:
- 19 - The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet. If the firm's ROE is forecast to decline to 8% in the future due a change in industry conditions, the firm's growth would be expected to: Increase Decrease Remain unchanged. There is not enough information to answer the question. None of the above answers is correct.18 - The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet Estimate the firm's PE multiple over the long term based on the absolute approach and round to 2 decimals. PE multiple:17 - The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet Estimate the expected annual rate of return on the common over the long term based on the absolute approach and round to 2 decimals. Expected annual rate of return:
- 14 -The common stock of Permanent Assurance Corporation currently trades at $40.00 per share, which is approximates its intrinsic value. The company has announced plans to maintain its dividend next year at $1.20 per share. Your research indicates that historically, the firm's dividend payout ratio has averaged 50% while its return on equity averaged 9.0%. The book value of the shares is $25.00 and research shows there is relatively low variation in the firm's operations. You believe the firm's payout ratio and ROE should continue at their historic levels in the future over the long term. Enter your answers on the spreadsheet. Calculate the dividend yield of the firm's shares based on the announced dividend and rounded to 2 decimals: Dividend Yield:9. a. Doldrums Plastics has been paying a $3 dividend each year for two years andcompany reports indicate that management intends to continue this dividendpayment for the foreseeable future. The market determined required rate ofreturn on Doldrums's common stock is 15 percent, what will be the price of a shareof stock? b. Suppose that an aggressive new Chief Executive Officer, Dee Uamoca, is hired byDoldrums. Because of the productive policies and processes instituted byUamoca, capital market investors anticipate that Doldrums's earnings anddividends will increase at a constant 8 percent rate beginning immediately. Whatwould be the price of a share of Doldrums common stock if the required rate ofreturn remains at 15 percent?25-The Engineering Company currently has 100,000 outstanding stocks selling at OMR 100 each. The firm is also thinking of declaring a dividend of OMR 5 per share at the end of the current fiscal year. The firms opportunity cost of capital is 10%. What will be price of the stock at the end of the year assume that dividend is declared under MM model? a. OMR 115 b. OMR 100 c. OMR 105 d. OMR 110
- 21 An investor is contemplating the purchase of common stock at the beginning of this year and to hold the stock for one year. The investor expects the year-end dividend to be P2.00 and expects a year-end price for the stock of P40. If this investor’s required rate of return is 10%, then the value of the stock to this investor is: Group of answer choices P34.88. P38.18. P33.06. P36.36.The current (time zero) price of one share of farell corporation's common stock is $25. The price is expected to increase by $5 over the coming year. The company is not expected to pay a dividend during the year. The standard deviation of the expected price change is $3. The distribution of the end of year possible prices is approximately normal. Determine the probability of earning a return greater than 30 percent over the coming year from your investment in farell common stock.Company A distributed a dividend of $ 4 per share last year. If the company is expected to distribute the same amount of dividends in the following years and the least profitability rate investors expect is 10%, what is the real value of the shares of company A? If the stock of this company is currently trading at 30 USD, can the relevant stock be purchased?a) 45 and must be purchasedb) 70.83 and must be purchasedc) 70.83 and should not be boughtd) 40 and should not be bought e) 40 and must be purchased ===================== How much money will be accumulated at the end of the 2nd year in our account where we deposit 700 USD at the beginning of each year with 9% interest?a) 4599,67b) 2750,25c) 1594,67d) 4200,25e) 5381,25 -------------------- How many USD should a person who constantly wants to receive 4500 USD at the end of each year invest in a bank that pays 12.5% interest today?a) 24000b) 40000 c) 10000d) 36000e) 28000
