What was the capital gain of the tips in dollars

Assignment Help Financial Management

Reference no: EM131359006

1. Dividend Initiation and Stock Value A firm does not pay a dividend. It is expected to pay its first dividend of $1.50 per share in 4 years. This dividend will grow at 14 percent indefinitely. Using a 16 percent discount rate, compute the value of this stock.

A) $48.05

B) $85.50

C) $47.22

D) $135.80

2. TIPS Capital Return Consider a 3.25% TIPS with an issue CPI reference of 188.00. At the beginning of this year, the CPI was 198.80 and was at 205.00 at the end of the year. What was the capital gain of the TIPS in dollars? (Round your answer to 2 decimal places.)

A) $32.98

B) $6.20

C) $10.80

D) $17.00

Reference no: EM131359006

Questions Cloud

Fresher foods sued vernon for damages : Fresher Foods, Inc., orally agreed to purchase one thousand bushels of corn for $1.25 per bushel from Dale Vernon, a farmer. Fresher Foods paid $125 down and agreed to pay the remainder of the purchase price on delivery, which was scheduled for one w..

On what basis could delta prevail : Delta Company makes and sells table saws, which are designed to be safe if used properly. Erin buys a Delta saw and lends it to her neighbor Frank. Frank loses his footing, slips off the saw, falls on the blade, and is injured. He files a product lia..

What is the purpose of preparing cash flow statement : What is common-size analysis and what information can it tell you about an organization that looking at the $$ s on the financial statements alone cannot provide? Provide an example of an annuity found in a business environment and how you would find..

Straddle is an investment strategy : A straddle is an investment strategy in options with which the investor holds a position in both a call and put with the same strike price and expiration date. A long straddle involves going long, i.e., purchasing, both a call option and a put option..

What was the capital gain of the tips in dollars : TIPS Capital Return Consider a 3.25% TIPS with an issue CPI reference of 188.00. At the beginning of this year, the CPI was 198.80 and was at 205.00 at the end of the year. What was the capital gain of the TIPS in dollars? (Round your answer to 2 dec..

Firm is under-valued or over-valued : Under/Over Valued Stock A manager believes his firm will earn a 17.0 percent return next year. His firm has a beta of 1.60, the expected return on the market is 15.0 percent, and the risk-free rate is 5.0 percent. Compute the return the firm should e..

Describe the cash flow projecting steps : You need to draw firm’s cash flow statement. What are main assumptions you are taking into account when creating a cash flow? Describe the cash flow projecting steps.

Trade european call and put options on stock : Suppose you can trade European call and put options on a stock with a current price of S at maturities and strike prices of your choice. However, due to your portfolio risk management you want to take a forward positionmaturing at time T on this stoc..

Labour and overheads will accrue evenly during the year : You need to calculate an estimate of working capital and projected Balance Sheet for the year ended on 31.12.20x7 from the following information. Share capital 500,000 €, Long-term loan (with fixed 15% p.a. interest) of 200,000 €., Fixed assets at co..

User Account

All Pages