Question
Helen Inc. paid a $1 per share dividend yesterday. The dividend is expected to grow steadily at a rate of 4% per year. (10 Marks)
Helen Inc. paid a $1 per share dividend yesterday. The dividend is expected to grow steadily at a rate of 4% per year. (10 Marks)
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What is the expected dividend in each of the next three years?
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If the discount rate for the stock is 12%, at what price will the stock sell?
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What is the expected stock price three years from now?
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If you buy the stock and plan to hold it for 3 years, what payments will you receive?
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What is the present value of those payments?
b) Give short explanations for the following (10 Marks)
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Bond = Equity (True/False); Stock = Debt (True/False)
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What are the differences between Debt and Equity in terms of Dividends, Taxes, Voting Rights, Bankruptcy?
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Truth About Buying Annuities Annuities Can Make Or Break Your Retirement
Authors: Steve Weisman
1st Edition
0132353083,0132701162
