3. From the following information, calculate the market value of equity share of a company as per...

Question:

3. From the following information, calculate the market value of equity share of a company as per Walter’s model:

Earnings after tax – `15,00,000; number of equity shares outstanding – 3,00,000; Dividend paid – `6,00,000, Price-earnings ratio – 10, Rate of return on investment – 20%.

What is the optimum dividend payout ratio in this case?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial Management

ISBN: 9789352605606

1st Edition

Authors: Swapan Sarkar, Bappaditya Biswas, Samyabrata Das, Ashish Kumar Sana

See More Books

Question Posted: Jul 23, 2024 07:01 AM

See More Questions

I t was Swiss hotelier Csar Ritz, founder of the Parisian Htel Ritz back in 1898, who coined the familiar phrase the customer is always right. For the modern hospitality manager who must constantly...
You are evaluating the performance of two portfolio managers, and you have gathered annual return data for the past decade: a. For each manager, calculate (1) the average annual return, (2) the...
Richard Penn lives in Harrisburg, Pennsylvania. Richard is the president of an architectural firm. Richard has become known throughout the community for excellent work and honesty in his business...
Talk with others to determine the types of insurance they have.
Madrid Jewelry Company reported the following summarized balance sheet at December 31, 2018: Assets Current assets..................................................................... $ 33,400...
To calculate the rate of return on an investment, a. divide the original investment by the amount of the gain. b. divide the amount of the gain by the original amount invested. c. subtract the amount...
2. Z Co. Ltd. has an investment of `10,00,000 in equity shares of `100 each. The profitability rate of the company is 16%. Payout ratio is 80%. Cost of capital is 10%. What will be the price per...
4. A company belongs to a risk class for which the appropriate capitalization rate for is 10%. It currently has outstanding 25,000 shares selling at `100 each. The firm is contemplating the...
In your opinion, are there any differences facing SMEs and larger firms when dealing with an entry mode decision?
Assume the ledge has the dimensions shown and is attached to the building with a series of equally spaved pins around the circumference of the building. Design the pins so that the ledge can support...
Describe in detail about the arterial supply and venous drainage of heart with its Applied Anatomy?
1. Gluteus maximus muscle and mention the structures covered by it.
2. External features and relations of Kidney.
3. Features of Synovial joint and its classification.
The total cross-sections for reactions between alkali metal atoms and halogen molecules are given in the table below (R.D. Levine and R.B. Bernstein, Molecular reaction dynamics, Clarendon Press,...
The May 2014 revenue and cost information for Houston Outfitters, Inc. follow: Sales Revenue (at standard).............. $ 540,000 Cost of Goods Sold (at standard) ..........341,000 Direct Materials...
You are ready to buy a house, and you have $30,000 for a down payment and closing costs. Closing costs are estimated to be 5% of the loan value. You have an annual salary of $48,000, and the bank is...
Universal Laser, Inc., just paid a dividend of $3.50 on its stock. The growth rate in dividends is expected to be a constant 5 percent per year, indefinitely. Investors require a return of 13 percent...
The market price is $900 for a 10-year bond ($1,000 per value) that pays 8% interest (4% semiannually). What is the bonds expected rate of return?

3. From the following information, calculate the market value of equity share of a company as per...

Question:

Step by Step Answer:

Financial Management

Students also viewed these Business questions