Question
Need Help with these, thanks. Explanations are helpful I have answers from study guide Kobe Durant is considering the purchase of a car, which will
Need Help with these, thanks. Explanations are helpful I have answers from study guide
Kobe Durant is considering the purchase of a car, which will cost him $125,000. He will borrow the entire purchase price and make monthly payments over the next five years. The first payment is due next month and the interest rate is 3.00%. He will owe $____ on the car immediately following the 27thpayment.
71,060.56
73,182.94
75,798.22
77,434.28
79,282.85
An investment will pay $32,000 per year forever beginning6 years from today. If the relevant rate is 10% compounded monthly, the investment is worth $______ today.
164,210.60
175,604.75
181,154.33
198,694.82
202,346.54
McDavids common stock has a beta of 1.40. The market risk premium, is 5% and the risk-free rate, rf, is 3%. McDavids expects to pay a dividend of $2.10 next year, and the dividend is expected to grow at 4% per year forever. The price of McDavids common stock should be $________.
31.50
35.00
38.50
42.00
42.50
American Graphics just paid a dividend of $3.00. AGs dividends will grow at 25% for the next two years and then 30% for the next year. After that, the dividend will grow at 4% forever. Assuming a 11% cost of equity, the current stock price should be $_____.
58.15
60.02
70.02
77.84
79.65
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