Question
JJ industries will pay a regular dividend of $2.40 per share for each of the next four years. At the end of the four years,
JJ industries will pay a regular dividend of $2.40 per share for each of the next four years. At the end of the four years, the company will also pay out a $40 per share liquidating dividend and the company will cease operations.
1-If the discount rate is 10%, what is the current value of the company's stock?
2-Suppose the current share price is $60, if all other info remains the same what must the liquidating dividend be?
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Personal Finance
Authors: Jeff Madura, Hardeep Singh Gill
3rd Canadian Edition
978-0133035575, 133035573, 978-0133970524, 133970523, 978-0134040042
