Horse and buggy inc is in a declining industry sales, Ask an Expert

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Horse and Buggy Inc. is in a declining industry. Sales, earnings, and dividends are all shrinking at a rate of 10% per year.

a. If r = 15% and DIV1 = $2, what is the value of a share? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

b. What price do you forecast for the stock next year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

c. What rate of return should you expect if you buy the stock today and sell it in one year? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92853599

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