The investment banking firm of Einstein Co will use a dividend valuation model to appraise the shares of the Modern Physics Corporation Dividends (D1) at the end of the current year will be $1 64 The growth rate (g) is 8 percent and the discount rate (Ke) is 13 percent a What should be the price of...

Einstein Co a P 0 D 1 K e g 164013 008 164005 328 b Public Price ...

The investment banking firm of Einstein & Co. will use a dividend valuation model to appraise the

Question:

The investment banking firm of Einstein & Co. will use a valuation model to appraise the shares of the Modern Physics Dividends (D1) at the end of the current year will be $1.64. The growth rate (g) is 8 percent and the (Ke) is 13 percent.
a. What should be the price of the stock to the public?
b. If there is a 7 percent total underwriting spread on the stock, how much will the issuing receive?
c. If the issuing requires a net price of $31.30 (proceeds to the and there is a 7 percent underwriting spread, what should be the price of the stock to the public? (Round to two places to the right of the decimal point.) Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...