What is its nominal annual rate of return

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1. PREFERRED STOCK RETURNS Bruner Aeronautics has perpetual preferred stock outstanding with a par value of $100. The stock pays a quarterly dividend of $2, and its current price is $80. a. What is its nominal annual rate of return? b. What is its effective annual rate of return?

2. VALUATION OF A DECLINING GROWTH STOCK Martell Mining Company's ore reserves are being depleted, so its sales are falling. Also, because its pit is getting deeper each year, its costs are rising. As a result, the company's earnings and dividends are declining at the constant rate of 5% per year. If D_0 = 85 and r_s = 15%, what is the value of Martell Mining's stock?

3. VALUATION A CONSTANT GROWTH STOCK A stock is expected to pay a dividend of $0.50 at the end of the year (that is, D_1 = 0.50), and it should continue to grow at a constant rate of 7% year.

Reference no: EM131510796

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