Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

BNL corporation has just distributed a 45 dividend. The company has announced that dividend payments will grow by 5% in next year, 3% in two

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
BNL corporation has just distributed a 45 dividend. The company has announced that dividend payments will grow by 5% in next year, 3% in two years and 10% in three years. If the dividends are expected to grow by 3% thereafter, what is the price of a BNL share today? (required rate of return: 8%) (10 Points) o 90.52 85.25 87.33 89.19 9 Assume an investment opportunity which provides the following cash flows: 17,000$ in one year, 10,000$ in two years, 8,500$ in three years, 12,000$ in four years and 5,000$ in five years. If the relevant required rate of return for this investment is 8%, what is the investment's value in year three? (15 Points) 55,154 53,633 51,081 54.527 10 A government bond makes semi-annual payments and it pays 9% coupon payments of its 1,500$ face value. The bond has 15 payments left until the maturity and the YTM is 12%. What is the current value of this bond? (10 Points) 128147 1355.12 124320 1301.20 11 As the credit manager of a local bank you decided to give 10.0005 credit to your customer. The customer agreed to pay back this loan as 4 equal payments. If the interest rate is 7%, what is the interest payment which must be paid in year two? (15 Points) 502.98 54234 59050 550 28 12 There is a new road project which is expected to be finished in 4 years. This project has an initial cost of 1 million $. After the initial cost is paid, the road project is expected to provide 250,000$ in year 1, 300.000 in year 2, 320,000 in year 3 and 450,000 in year 4. It is known that the internal rate of return in this project 10.96%. What is the net present value? (10 Points) Enter your answer 13 According to your estimations, the share price of XYZ corporation will be 605 two years from now. If you also beleive that the company will make a 35 dividend payment two years from now. what is the current price of the share? (required rate of return is 6.5%) (10 Points) 54.12 56.85 59.15 58.27

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Finance At The Threshold

Authors: Christopher Houghton Budd

1st Edition

0566092115, 978-0566092114

More Books

Students also viewed these Finance questions

Question

Prepare a short profile of victor marie hugo ?

Answered: 1 week ago

Question

Prepare a short profile of Henry words worth Longfellow?

Answered: 1 week ago

Question

What is RAM as far as telecommunication is concerned?

Answered: 1 week ago

Question

Question 1: What is reproductive system? Question 2: What is Semen?

Answered: 1 week ago