What is the present value of the expected dividends

Assignment Help Financial Management

Reference no: EM132000063

China S. Construction, Inc., is in the business of building electrical power plants in the eastern United States. Jack Godell and the rest of the board members of the firm have just announced a $4 per share dividend on the corporation’s common stock to be paid in one year. Because the quality of some of its recent projects is under attack by investigative television reporters, the expected constant dividend growth rate is only estimated to be 1 percent. The required rate of return for similar stocks in this industry is 16 percent.

a. What is the present value of the expected dividends from one share of China S. Construction’s common stock?

Reference no: EM132000063

Questions Cloud

Basis for much international trade : Once we recognize that product differentiation is the basis for much international trade, there are likely to be more winners and fewer losers

Describe the methods for establishing component priorities : A critical step in the development of an effective BIA includes establishing component priorities and determining component reliance and dependencies.

Factor-price equalization theorem : The factor-price equalization theorem indicates that with free trade the real wage earned by labor becomes equal to the real rental rate earned by landowners.

What kind of market events would result in disequilibrium : What kind of market events would result in disequilibrium? How would this disequilibrium affect the economic markets?

What is the present value of the expected dividends : What is the present value of the expected dividends from one share of China S. Construction’s common stock?

Yen cross rates would you quote on spot australian dollars : What bid and ask yen cross rates would you quote on spot Australian dollars(JPY/AUD)?

Explain four sources of unemployment : Explain these four sources of unemployment and explain how each contributes to the current unemployment problem facing the US.

What is the current death benefit from this policy : What is the current death benefit from this policy?

Adverse selection and moral hazard : Many police officer positions require the applicant to have a college degree even though the tasks of a police officer rarely call upon college course material

User Account

All Pages