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1) Assume Zero-Sum Enterprise pays an annual dividend of $1.40 per share and that neither earnings.. 1 answer below » 1) Assume Zero-Sum Enterprise pays an annual dividend of $1.40 per share and that neither earnings nor dividends are expected to grow in the future. What is the value of Zero-Sum’s stock to an investor who requires a 14% rate of return? a) $14.00 b) $20.00 c) $10.00 d) $0 2) Gold Corp. expects to pay dividends of $1.96 per share next year (D1). If the companys dividend is growing at a rate of 2% per year, and your required rate of return is 8%, what is Gold’s stock worth to you? a) $100.00 b) $32.67 c) $33.32 d) $20.00 3) An increase in which of the following will increase the current value View complete question » 1) Assume Zero-Sum Enterprise pays an annual dividend of $1.40 per share and that neither earnings nor dividends are expected to grow in the future. What is the value of Zero-Sum’s stock to an investor who requires a 14% rate of return? a) $14.00 b) $20.00 c) $10.00 d) $0 2) Gold Corp. expects to pay dividends of $1.96 per share next year (D1). If the companys dividend is growing at a rate of 2% per year, and your required rate of return is 8%, what is Gold’s stock worth to you? a) $100.00 b) $32.67 c) $33.32 d) $20.00 3) An increase in which of the following will increase the current value of a stock according to the dividend growth model. I. II. III. IV. dividend amount number of future dividends, provided the current number is less than infinite dividend growth rate discount rate a) I and II only b) III and IV only c) I, II, and III only d) I, II, and IV only e)I, II, III, and IV 4) Green Company’s common stock is currently selling at $40.25 per share. The company expects to pay dividends of $2.30 per share next year (D1) and projects dividend growth at a rate of 7%. At this rate, what is the stock’s expected rate of return? a) 12.71% b) 7.0% c) 13.11% d) 5.71% 5) What is the net present value of a project with the following cash flows if the required rate of return is 12%? Year 0: -$42,398 Year 1: $13,407 Year 2: $21,219 Year 3: $17,800 a) -$1,574.41 b) -$1,208.19 c) $1,311.16 d) $729.09 e) -$842.12 Document Preview: 1) Assume Zero-Sum Enterprise pays an annual dividend of $1.40 per share and that neither earnings nor dividends are expected to grow in the future. What is the value of Zero-Sum’s stock to an investor who requires a 14% rate of return?
a) $14.00
b) $20.00
c) $10.00
d) $0
2) Gold Corp. expects to pay dividends of $1.96 per share next year (D1). If the company’s dividend is growing at a rate of 2% per year, and your required rate of return is 8%, what is Gold’s stock worth to you?
a) $100.00
b) $32.67
c) $33.32
d) $20.00
3) An increase in which of the following will increase the current value of a stock according to the dividend growth model.
I. dividend amount
II. number of future dividends, provided the current number is less than infinite
III. dividend growth rate
IV. discount rate
a) I and II only
b) III and IV only
c) I, II, and III only
d) I, II, and IV only
e)I, II, III, and IV
4) Green Company’s common stock is currently selling at $40.25 per share. The company expects to pay dividends of $2.30 per share next year (D1) and projects dividend growth at a rate of 7%. At this rate, what is the stock’s expected rate of return?
a) 12.71%
b) 7.0%
c) 13.11%
d) 5.71%
5) What is the net present value of a project with the following cash flows if the required rate of return is 12%?
Year 0: -$42,398
Year 1: $13,407
Year 2: $21,219
Year 3: $17,800
a) -$1,574.41
b) -$1,208.19
c) $1,311.16
d) $729.09
e) -$842.12 Attachments: Q-Attachment…..docx View less » Aug 04 2015 09:51 AM
