What will be this year dividend payout ratio

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1. Unsaved Company JC Electronics had a net income of $2,000,000 this year. Next year's total capital budget is $2,600,000. If the target capital structure is 40% debt and the rest equity, what will be this year's dividend payout ratio?

2. The stock price of Bravo Corp. is currently $100. The stock price a year from now will be either $160 or $60 with equal probabilities. The interest rate at which investors invest in riskless assets at is 6%. Using the binomial OPM, the value of a put option with an exercise price of $135 and an expiration date one year from now should be worth __________ today.

Reference no: EM132048667

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