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Suppose you are thinking of purchasing the stock of XYZ Electronics, Inc. You expect it to pay a $4.00 dividend in one year. You believe
- Suppose you are thinking of purchasing the stock of XYZ Electronics, Inc. You expect it to pay a $4.00 dividend in one year. You believe you can sell the stock for $25.00 at that time. You require a return of 21% on investments of this risk. What is the maximum you would be willing to pay?
- Suppose you are thinking of purchasing the stock of XYZ Electronics, Inc. In addition to the dividend and price from year one you expect it to pay a $4.60 dividend in two years. You believe you can sell the stock for $28.75 at that time. You require a return of 21% on investments of this risk. What is the maximum you would be willing to pay?
- Suppose you are thinking of purchasing the stock of ABC Widget, Inc. In addition to the dividend and price from year one and two you expect it to pay a $5.29 dividend in three years. You believe you can sell the stock for $33.06 at that time. You require a return of 21% on investments of this risk. What is the maximum you would be willing to pay?
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Public Finance Administration
Authors: B. J. Reed, John W. Swain
2nd Edition
0803974051, 978-0803974050
