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You've collected the following information from your favorite financial website. 52-Week Price Hi 64.60 Lo 47.80 Div Yid % 1.9 PE Ratio 235.6 Close Price

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You've collected the following information from your favorite financial website. 52-Week Price Hi 64.60 Lo 47.80 Div Yid % 1.9 PE Ratio 235.6 Close Price 62.91 Net Chg --05 145.94 1.8 70.9 139.71 .62 Stock (Div) Abbott 1.12 Ralph Lauren 2.50 IBM 6.30 Duke Energy 3.56 Disney 1.68 70.28 139.13 71.96 171.13 4.3 23.8 145.39 19 91.80 4.9 17.6 74.30 84 113.19 96.20 1.7 15.5 ?? .10 According to your research, the growth rate in dividends for Ralph Lauren for the next 5 years will be 5 percent. If investors feel this growth rate will continue, what is the required return for the company's stock? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Required return 5.61% Vulcan, Inc., has 7 percent coupon bonds on the market that have 13 years left to maturity. The bonds make annual payments and have a par value of $1,000. If the YTM on these bonds is 8.4 percent, what is the current bond price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current bond price 891.74 The Petit Chef Co. has 7 percent coupon bonds on the market with 9 years left to maturity. The bonds make annual payments and have a par value of $1,000. If the bonds currently sell for $1,038.50, what is the YTM? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Yield to maturity 6.42% 09 An investment offers a total return of 12 percent over the coming year. Alex Hamilton thinks the total real return on this investment will be only 9 percent. What does Alex believe the inflation rate will be over the next year? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Inflation rate 2.75% H. Cochran, Inc., is considering a new three-year expansion project that requires an initial fixed asset investment of $2.15 million. The fixed asset will be depreciated straight- line to zero over its three-year tax life, after which time it will be worthless. The project is estimated to generate $2.23 million in annual sales, with costs of $1.25 million. If the tax rate is 23 percent, what is the OCF for this project? (Do not round intermediate calculations and round your answer to the nearest whole dollar amount, e.g., 32.) OCF

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