I believe it’s False, it might be wrong though
Answer:
The value of this stock today should be $6.22
Explanation:
The company will start paying dividends 2 years from today that is at t=2. The dividends received 2 years from today can be denoted as D2. The constant growth model of DDM will be used to calculate the price of this stock at t=2 as the growth rate in dividends is constant forever.
The price at t=2 will then be discounted back to its present value today to calculate the price of this stock today.
The price of this stock at t=2 will be,
P2 = D2 * (1+g) / (r - g)
P2 = 0.6 * (1+0.04) / (0.12 - 0.04)
P2 = $7.8
The value of this stock today should be,
P0 = 7.8 / (1+0.12)^2
P0 = $6.218 ROUNDED OFF TO $6.22
Answer:
(a) $546,300
(b) $12.88
Explanation:
(a) Earnings available to common stockholders:
= Dividend + Retained Earnings
= 33,300 + 513,000
= $546,300
Earnings available to common stockholders means the amount available to distribute as dividend.
But the company need not pay full earnings as dividend. They may left some portion as retained earnings.
(b) Earnings per share:
= Earnings available to common stockholders ÷ no. of shares of common stock
= $546,300 ÷ 42,400
= $12.88
Explanation:
in order to have a profession you need to get an education first ... if you start out working along side someone,that someone is giving you an education in how to do the job you want to do. if you are planning a profession such as a doctor or a lawyer , prepare yourself for a lot of education..