CORPORATE FINANCE
12th Edition
ISBN: 9781307702804
Author: Ross
Publisher: MCG/CREATE
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 9, Problem 13QAP
Summary Introduction
To calculate: Current share price
Introduction: The price at which a share of stock is currently trading on the market is referred to as the current stock price.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Bon Chance, Inc., has an odd dividend policy. The company has just paid a dividend of $9.50 per share and has announced that it will increase the dividend by $7.50 per share for each of the next four years, and then never pay another dividend.
A.
If you require a return of 15 percent on the company’s stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Q: Corn, Inc., has an odd dividend policy. The company has just paid a dividend of $6 per share and has announced that it will increase the dividend by $2 per share for each of the next four years, and then never pay another dividend. suppose you require an 11 percent return on thecompany’s stock.Required:a) how much will you pay for a share today?b) Is the value of this stock dependent upon how long you plan to hold it? would this affect the value of the stock today?c) What happens if a company has a constant growth g that exceeds its cost of capital ks?Will many stocks have expected g> ks in the short run? In the long run (that is, forever)?
XYZ Inc., has an odd dividend policy. The company has just paid a dividend of $11.00 per share and has announced that it will increase the dividend by $9.00 per share for each of the next four years, and then never pay another dividend.
If you require a return of 16 percent on the company’s stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Chapter 9 Solutions
CORPORATE FINANCE
Ch. 9 - Stock Valuation Why does the value of a share of...Ch. 9 - Stock Valuation A substantial percentage of the...Ch. 9 - Dividend Policy Referring to the previous...Ch. 9 - Prob. 4CQCh. 9 - Common versus Preferred Stock Suppose a company...Ch. 9 - Dividend Growth Model Based on the dividend growth...Ch. 9 - Growth Rate In the context of the dividend growth...Ch. 9 - Price-Earnings Ratio What are the three factors...Ch. 9 - Prob. 9CQCh. 9 - Prob. 10CQ
Ch. 9 - Prob. 1QAPCh. 9 - Stock Values The next dividend payment by Skippy,...Ch. 9 - Prob. 3QAPCh. 9 - Stock Values Saine Corporation will pay a 3.25 per...Ch. 9 - Stock Valuation Change, Inc., is expected to...Ch. 9 - Stock Valuation Suppose you know that a companys...Ch. 9 - Prob. 7QAPCh. 9 - Prob. 8QAPCh. 9 - Growth Rate The newspaper reported last week that...Ch. 9 - Prob. 10QAPCh. 9 - Prob. 11QAPCh. 9 - Prob. 12QAPCh. 9 - Prob. 13QAPCh. 9 - Prob. 14QAPCh. 9 - Prob. 15QAPCh. 9 - Prob. 16QAPCh. 9 - Prob. 17QAPCh. 9 - Prob. 18QAPCh. 9 - Valuing Preferred Stock Fifth National Bank just...Ch. 9 - Prob. 20QAPCh. 9 - Nonconstant Growth and Quarterly Dividends...Ch. 9 - Finding the Dividend Newkirk, Inc., is expected to...Ch. 9 - Prob. 23QAPCh. 9 - Prob. 24QAPCh. 9 - Price-Earnings Ratio Consider Pacific Energy...Ch. 9 - Prob. 26QAPCh. 9 - Stock Valuation and EV FFDP Corp. has yearly sales...Ch. 9 - Stock Valuation and Cash Flows Full Boat...Ch. 9 - Prob. 29QAPCh. 9 - Prob. 30QAPCh. 9 - Nonconstant Growth Storico Co. just paid a...Ch. 9 - Prob. 32QAPCh. 9 - Prob. 1MCCh. 9 - Prob. 2MCCh. 9 - Prob. 3MCCh. 9 - Prob. 4MCCh. 9 - Prob. 5MCCh. 9 - Prob. 6MC
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Hot Wings, Inc has an odd divdend policy. The company has just paid a dividend of $8.10 per share and has announced that it will increase the dividend by $6.10 per share for each of the next four years, and then never pay another dividend. Required: If you require a 13.50 percent return on the company's stock, how much will you pay for a share today?arrow_forwardPremier inc has an odd dividend policy. The company has just paid a dividend of $3.75 per share and has announced that it will increase the dividend by $5 per share for each of the next 5 years and then never pay another dividend. If you require a return of 11% on the company’s stock, how much will you pay for a share today?arrow_forwardBon Chance, Inc., has an odd dividend policy. The company has just pald a dividend of $6.75 per share and has announced that it will increase the dividend by $10.50 per share for each of the next four years, and then never pay another dividend. If you require a return of 13 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share pricearrow_forward
- JustKidding Corporation has an odd dividend policy. The company has just paid a dividend of $4 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 12 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) (*answer is not $76.93)arrow_forwardPremier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $4 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 10 percent on the company’s stock, how much will you pay for a share today? What is the current share price?arrow_forward15. Nonconstant Dividends Corn, Inc., has an odd dividend policy. The company has just paid a dividend of $9 per share and has announced that it will increase the dividend by $3 per share for each of the next four years, and then never pay another dividend. If you require an 11 per- cent return on the company's stock, how much will you pay for a share today?arrow_forward
- Premier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $10.35 per share and has announced that it will increase the dividend by $9.50 per share for each of the next four years, and then never pay another dividend. If you require a return of 12 percent on the company's stock, how much will you pay for a share today? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. 4 99+ X Answer is complete but not entirely correct. Current share price W X P A 60.10 x 86°F Sunnyarrow_forwardPremier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $11.00 per share and has announced that it will increase the dividend by $9.00 per share for each of the next four years, and then never pay another dividend. If you require a return of 16 percent on the company's stock, how much will you pay for a share today? Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Current share pricearrow_forward: Corn, Inc., has an odd dividend policy. The company has just paid a dividend of $6 per share and has announced that it will increase the dividend by $2 per share for each of the next four years, and then never pay another dividend. suppose you require an 11 percent return on the company’s stock. Required: a) how much will you pay for a share today? b) Is the value of this stock dependent upon how long you plan to hold it? would this affect the value of the stock today? c) What happens if a company has a constant growth g that exceeds its cost of capital ks? Will many stocks have expected g> ks in the short run? In the long run (that is, forever)?arrow_forward
- HQZ Inc., has just paid a dividend of $4.9 per share and has announced that it will increase the dividend by $2.36 per share for each of the next four years, and then never pay another dividend. If you require a return of 9.43 percent on the company's stock, how much will you pay for a share today? Answer to two decimals.arrow_forwardPremier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $3.75 per share and has announced that it will increase the dividend by $5 per share for each of the next five years and then never pay another dividend. If you require a return of 11 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share pricearrow_forwardPremier, Incorporated, has an odd dividend policy. The company has just paid a dividend of $2 per share and has announced that it will increase the dividend by $6 per share for each of the next five years and then never pay another dividend. If you require a return of 10 percent on the company's stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price Saved 4 of 9 Score.E E KWarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Financial Projections for Startups Basic Walkthrough; Author: Mike Lingle;https://www.youtube.com/watch?v=7avegQF4dxI;License: Standard youtube license