Performance of income measures cash flows of value

Assignment Help Financial Management

Reference no: EM131558600

1. Ross's common stock currently sells for $40 per share. The firm recently paid a dividend of $2 per share on its common stock, and investors expect the dividend to grow indefinitely at a constant rate of 10% per year. What's the firm's cost of common stock using DCF approach?

9.5%

10.0%

15.5%

16.5%

2. The performance of income measures cash flows of a value in relation to any price, as the sales price or current market price negotiable, but they are not liquids.

to. Correct

b. Incorrect

3. A bond purchased at par and kept until maturity provides a yield in the form of cash flow, so it has a change in the price.

to. Correct

b. Incorrect

4. With a dividend of $3.00 per year, stock market price of $10.50 and purchase price of $13.00 cash flow performance would be

to. 6.85%

b. 5.60%

c. 4.75%

d. 3.85%

Reference no: EM131558600

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