Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Basic Finance Expert

1) Highcorp is expected to pay the dividend $5.20 next year. Its dividend is expected to produce at 9% pa for following year. Dividends are then expected to rise at 4.5% pa for another 5 years. Then they are expected to rise at 3.5%pa forever after that. Shareholders need return on equity is 14.85% pa. Determine the present price of Highcorp shares?

2) ABC Ltd is not expecting to pay dividends for 3 years, at the end of year 4, a dividend of= $2.25 is planned and dividends are expected to be constant forever after that. Necessary rate of return for ABC Ltd equity is 11.25% pa. What is the expected price (ex-dividend) of ABC Ltd’s shares at beginning of year eight? Describe your logic in detail.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M914367

Have any Question? 


Related Questions in Basic Finance

What is a supply shockwhat is the appropriate policy

What is a supply shock? What is the appropriate policy response to a negative supply shock? What determines whether policy makers should act or do nothing in the face of adverse shocks to either aggregate demand or aggre ...

Following table shows the price information for three

Following table shows the price information for three stocks:  Stock Price 0 Quantity 0 P 1 Q 1 A $70 50 $85 50 B 10 150 12 150 C 100 30 50 60 1. What happened for stock C during this period? 2. Calculate the price-weigh ...

1 briefly explain how shareholders returns are taxed twice

1. Briefly explain how shareholders' returns are taxed twice in the United States with tax laws that favor capital gains. 2. Rightists argue that increasing a firm's dividend will increase its value. Review some of the k ...

Artie bella and carmen are medicare part d recipientsartie

Artie, Bella, and Carmen are Medicare Part D recipients. Artie currently has $1,000 in prescription drug costs each year. Bella and Carmen have $3,000 and $6,000, respectively. Each has a mild case of insomnia, and a new ...

Case study - john simpsonbackgroundjohn has been a

Case study - John Simpson Background John has been a self-employed carpenter for 10 years, and operates his business under a company structure. He has approached you for help in arranging finance for a potential purchase ...

Lambda corporation has current liabilities of 430000 a

Lambda Corporation has current liabilities of $430,000, a quick ratio of 1.7, inventory turnover of 4.9, and a current ratio of 3.4. What is the cost of goods sold for Lambda Corporation?

Assume that after you graduate you get a job as the chief

Assume that after you graduate, you get a job as the chief financial officer of a small company. Explain why being able to forecast the direction of interest rate changes may be critical for your success in that position ...

In 2006 ben bernanke said the goals of strong output growth

In 2006, Ben Bernanke said the goals of strong output growth and low inflation "are almost always consistent with each other." Alan Greenspan once called the trade-off between output and inflation "ephemeral." a. Are the ...

Consider two risky stocks their variances are different

Consider two risky stocks (their variances are different from zero), which are perfectly negatively correlated, i.e., their correlation is equal to -1. Is it possible to combine these two stocks and form a zero-risk port ...

An investor has a cash of 10000000 at disposal he wants to

An investor has a cash of $10,000,000 at disposal. He wants to invest in a bond with $1,000 nominal value and whose dirty price is equal to 107.457%. 1. What is the number of bonds he will buy? 2. Same question if the no ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

A cola-dispensing machine is set to dispense 9 ounces of

A cola-dispensing machine is set to dispense 9 ounces of cola per cup, with a standard deviation of 1.0 ounce. The manuf

What is marketingbullwhat is marketing think back to your

What is Marketing? • "What is marketing"? Think back to your impressions before you started this class versus how you

Question -your client david smith runs a small it

QUESTION - Your client, David Smith runs a small IT consulting business specialising in computer software and techno

Inspection of a random sample of 22 aircraft showed that 15

Inspection of a random sample of 22 aircraft showed that 15 needed repairs to fix a wiring problem that might compromise

Effective hrmquestionhow can an effective hrm system help

Effective HRM Question How can an effective HRM system help facilitate the achievement of an organization's strate