What price will you be willing to pay for the stock

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Reference no: EM131953589

1. You are scheduled to receive $15,500 in three years. When you receive it, you will invest it for seven more years at 9 percent per year. How much will you have in ten years? (Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., 32.16.)

2. You believe that a stock with the same market risk as the S&P/TSX will sell at year-end at a price of $50. The stock will pay a dividend at year-end of $2. What price will you be willing to pay for the stock?

Hint: Start by checking today's three-month treasury bill rate.

Reference no: EM131953589

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