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PLEASE USE EXCEL WITH FORMULAS Problem 1 [ 5 points ] : McGaha Enterprises expects earnings and dividends to grow at a rate of 2
PLEASE USE EXCEL WITH FORMULAS Problem points:
McGaha Enterprises expects earnings and dividends to grow at a rate of for the next years, after
the growth rate in earnings and dividends will fall to zero, ie The company's last dividend,
was $ its beta is the market risk premium is and the riskfree rate is What is the
current price of the common stock?
Problem points:
The value of BroadwayBrooks Inc.s operations is $ million, based on the corporate valuation model.
Its balance sheet shows $ million in accounts receivable, $ million in inventory, $ million in short
term investments that are unrelated to operations, $ million in accounts payable, $ million in notes
payable, $ million in longterm debt, $ million in preferred stock, $ million in retained earnings,
and $ million in total common equity. If the company has million stock outstanding shares, what
is the best estimate of the stock's price per share?
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