(Solution Download) A11. (Expected return) Northern States Power has a projected dividend of $3.60 next year. The...


A11. (Expected return) Northern States Power has a projected dividend of $3.60 next year. The current stock price is $50.50 per share. If the dividend is projected to grow at 3.5% annually, what is the expected return on Northern States stock? B19. (Constant growth model) a. The current dividend for Birmingham Electric is $2.40 and is growing at 5% annually. If the required return is 13%, what is the value of one share of stock? b. Montgomery Audio is expected to pay a $1.30 dividend next year. The dividend is expected to grow at 6% annually. If the current stock price is $21.25, what is Montgomery?s required return? B21. (Dividend valuation) Wichita Realty Trust is expected to pay a modest dividend of $1.00 per share for two years and then $2.00 per share for years three through five. Then in year six, Wichita Realty Trust is planning to pay a $40.00-per-share liquidating dividend and go out of business. What is the value of a share of this firm if the required return is 10%? CHAPTER 7 A1. (Calculating beta) What is the beta of a stock whose covariance with the market portfolio return is 0.0045 if the variance of the return on the market portfolio is 0.002?

 







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