an a. b. c. d. e.
8 percent rate of return $ $ $ $ $
STOCK VALUE
d 61. Lee Hong Imports paid a $ per share annual dividend last week. Dividends are expected to increase by 5 percent annually. What is one share of this stock worth to you today if the appropriate discount rate is 14 percent a. $ b. $ c. $ d. $ e. $
STOCK VALUE
c 62. Majestic Homes stock traditionally provides an 8 percent rate of return. The company just paid a $2 a year dividend which is expected to increase by 5 percent per year. If you are planning on buying 1,000 shares of this stock next year, how much should you expect to pay per share if the market rate of return for this type of security is 9 percent at the time of your purchase a. $ b. $ c. $ d. $ e. $
STOCK VALUE
c 63. Leslie’s Unique Clothing Stores offers a common stock that pays an annual dividend of $ a share. The company has promised to maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn 12 percent return on your equity investments a. $ b. $ c. $ d. $ e. $
STOCK VALUE
b 64. Martin’s Yachts has paid annual dividends of $, $, and $ a share over the past three years, respectively. The company now predicts that it will maintain a constant dividend since its business has leveled off and sales are expected to remain
you a. b. c. d. e.
relatively constant. Given the lack of future growth, you will only buy this stock if can earn at least a 15 percent rate of return. What is the maximum amount you are willing to pay to buy one share of this stock today $ $ $ $ $
REQUIRED RETURN
c 65. The common stock of Eddie’s Engines, Inc. sells for $ a share. The stock is expected to pay $ per share next month when the annual dividend is distributed. Eddie’s has established a pattern of increasing their dividends by 4 percent annually and expects to continue doing so. What is the market rate of return on this stock a. 7 percent b. 9 percent c. 11 percent d. 13 percent e. 15 percent
REQUIRED RETURN
a 66. The current yield on Alpha’s common stock is percent. The company just paid a $ dividend. The rumor is that the dividend will be $ next year. The dividend growth rate is expected to remain constant at the current level. What is the required rate of return on Alpha’s stock a. percent b. percent c. percent d. percent e. percent
REQUIRED RETURN
e 67. Martha’s Vineyardrecently paid a $ annual dividend on their common stock. This dividend increases at an average rate of percent per year. The stock is currently selling for $ a share. What is the market rate of return a. percent b. percent c. percent d. percent e. percent
REQUIRED RETURN
d 68. Bet’R Bilt Bikes just announced that their annual dividend for this coming year will be $ a share and that all future dividends are expected to increase by percent annually. What is the market rate of return if this stock is currently selling for $22 a share a. percent b. percent c. percent d. percent
e. percent
财务管理 CHAPTER 8
