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Your father has several investments. One of them is 5 0 0 shares of PUMA Oil. PUMA is expected to pay a dividend next year
Your father has several investments. One of them is shares of PUMA Oil. PUMA is
expected to pay a dividend next year of The expected dividend growth rate is
per year forever. Another of your father's investments is shares of MADISON. It has
an expected growth rate in dividends of per year forever. It sells for It is
expected to pay a dividend of K per share next year. Answer the below questions.
A If PUMA is selling for K per share, what is your father's expected return on PUMA
Oil?
B What is your father's expected return on MADISON?
C Does it appear if one of the investments is superior to the other? Explain. As someone
with the knowledge of investment, what would be your advice to your father?
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