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82.
Renew It, Inc., is preparing to pay its first dividend. It is going to pay $0.45,
$0.60, and $1 a share over the next three years, respectively. After that, the
company has stated that the annual dividend will be $1.25 per share
indefinitely. What is this stock worth to you per share if you demand a 10.8
percent rate of return on stocks of this type?
83.
Diets For You announced today that it will begin paying annual dividends
next year. The first dividend will be $0.12 a share. The following dividends
will be $0.15, $0.20, $0.50, and $0.75 a share annually for the following 4
years, respectively. After that, dividends are projected to increase by 4
percent per year. How much are you willing to pay to buy one share of this
stock today if your desired rate of return is 8.5 percent?
84.
Crystal Glass recently paid $3.60 as an annual dividend. Future dividends
are projected at $3.80, $4.10, and $4.25 over the next 3 years, respectively.
Beginning 4 years from now, the dividend is expected to increase by 3.25
percent annually. What is one share of this stock worth to you if you require
a 12.5 percent rate of return on similar investments?
85.
Langley Enterprises pays a constant dividend of $0.85 a share. The
company announced today that it will continue to pay the dividend for
another 2 years after which time all dividends will cease. What is one share
of this stock worth today if the required rate of return is 16.5 percent?
86.
Yesteryear Productions pays no dividend at the present time. The company
plans to start paying an annual dividend in the amount of $0.40 a share for
two years commencing four years from today. After that time, the company
plans on paying a constant $0.75 a share annual dividend indefinitely. How
much are you willing to pay to buy a share of this stock today if your
required return is 11.6 percent?
87.
Sweatshirts Unlimited is downsizing. The company paid a $2.80 annual
dividend last year. The company has announced plans to lower the dividend
by 25 percent each year. Once the dividend amount becomes zero, the
company will cease all dividends and go out of business. You have a
required rate of return of 18 percent on this particular stock given the
company's situation. What are your shares in this firm worth today on a per
share basis?
88.
Dexter Metals, paid its first annual dividend yesterday in the amount of
$0.18 a share. The company plans to double each annual dividend payment
for the next 3 years. After that time, it plans to pay $1.25 a share for 2 years
than then pay a constant dividend of $1.60 per share indefinitely. What is
one share of this stock worth today if the market rate of return on similar
securities is 10.24 percent?
89.
Marshall Arts Studios just paid an annual dividend of $1.36 a share. The
firm plans to pay annual dividends of $1.50, $1.55, and $1.58 over the next 3
years, respectively. After that time, the dividends will be held constant at
$1.70 per share. What is this stock worth today at a 9 percent discount
rate?
90.
Home Care Providers is paying an annual dividend of $1.10 every other year.
The last dividend was paid two years ago. The firm will continue this policy
until 3 more dividend payments have been paid. One year after the last
dividend normal payment, the company plans to pay a final liquidating
dividend of $40 per share. What is the current market value of this stock if
the required return is 17 percent?
91.
Last year, Hansen Delivery paid an annual dividend of $3.20 per share. The
company has been reducing the dividends by 10 percent annually. How
much are you willing to pay to purchase stock in this company if your
required rate of return is 13 percent?
92.
Beatrice Markets is expecting a period of intense growth and has decided to
retain more of its earnings to help finance that growth. As a result, it is
going to reduce its annual dividend by 30 percent a year for the next 2
years. After that, it will maintain a constant dividend of $2.50 a share. Last
year, the company paid $3.60 as the annual dividend per share. What is the
market value of this stock if the required rate of return is 14.5 percent?
93.
Bonnie's Ice Cream is expecting its ice cream sales to decline due to the
increased interest in healthy eating. Thus, the company has announced that
it will be reducing its annual dividend by 2 percent a year for the next five
years. After that, it will maintain a constant dividend of $2 a share. Last
year, the company paid $2.35 per share. What is this stock worth to you if
you require a 9.5 percent rate of return?
94.
J&J Foods wants to issue some 7 percent preferred stock that has a stated
liquidating value of $100 a share. The company has determined that stocks
with similar characteristics provide a 12.8 percent rate of return. What
should the offer price be?
95.
The preferred stock of Rail Lines, Inc., pays an annual dividend of $12.25
and sells for $59.70 a share. What is the rate of return on this security?
96.
Marie owns shares of Deltona Productions preferred stock which she says
provides her with a constant 14.3 percent rate of return. The stock is
currently priced at $45.45 a share. What is the amount of the dividend per
share?
97.
Zylo, Inc. preferred stock pays a $7.50 annual dividend. What is the
maximum price you are willing to pay for one share of this stock today if
your required return is 7.5 percent?
98.
Jefferson Mills just paid a dividend of $1.56 per share on its stock. The
dividends are expected to grow at a constant rate of 8 percent per year,
indefinitely. What will the price of this stock be in 7 years if investors
require a 15 percent rate of return?
99.
The next dividend payment by Hillside Markets will be $2.35 per share. The
dividends are anticipated to maintain a 4.5 percent growth rate forever. The
stock currently sells for $65 per share. What is the dividend yield?
100.
The Stiller Corporation will pay a $3.80 per share dividend next year. The
company pledges to increase its dividend by 2.4 percent indefinitely. How
much are you willing to pay to purchase this company's stock today if you
require a 6.9 percent return on your investment?
