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Please show calculations. NO recycled answers. Thank you. You own 1,100 shares of stock in Avondale Corporation. You will receive a dividendo $1.50 per share
Please show calculations. NO recycled answers. Thank you.
You own 1,100 shares of stock in Avondale Corporation. You will receive a dividendo $1.50 per share in one year. In two years, the company will pay a liquidating dividendo $45 per share. The required return on the company's stock is 20 percent. a. Ignoring taxes, what is the current share price of your stock? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. If you would rather have equal dividends in each of the next two years, how man shares would you sell in one year? (Do not round intermediate calculations an round your answer to the nearest whole number, e.g., 32.) c. What would your cash flow be for each year for the next two years if you create equa homemade dividends? Hint: Dividends will be in the form of an annuity. (Do not round intermediate calculations and round your answer to the nearest whole number e.g., 32.) a. Share price b. Number of shares Cash flow cStep by Step Solution
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