Business, 14.04.2020 18:36 vixxs345

The current dividend yield on Clayton's Metals common stock is 3.2 percent. The company just paid a $1.48 annual dividend and announced plans to pay $1.54 next year. The dividend growth rate is expected to remain constant at the current level. What is the required rate of return on this stock?

Answers: 1

Show answers

Answers

Answer from: breanna7667

7.25%

Explanation:

To calculate this we will use the Constant Growth Model of calculating a Stock's price.

The formula is,

P = D1/(r-g),

where,

P is the current price,

D is the next dividend the company is to pay,

g is the expected growth rate in the dividend payment and

r is the required rate of return for the company.

We were given the Dividend Yield and with this can calculate the Stock Price.

The Dividend yield is the Dividend expressed as a percentage of Stock Price.

Making the stock price x with the next dividend at $1.54 we have

1.54 = 0.032x

x = 1.54/0.032

= $48.13

Now that we have the stock price we can plug it into the formula.

We also need to calculate the growth rate. Given that $1.48 was paid and $1.54 will be paid we can say,

g= 1.54 - 1.48

g= 0.06/1.48

= 4.05% is what it will take to grow $1.48 to $1.54

Now we can plug all these into the formula,

Making r the subject we have,

r = D1/P + g

= 1.54/48.13 + 0.0405

= 7.25%

The required rate of return on this stock is therefore 7.25%.

Answer from: Quest

bd = 9 cm

step-by-step explanation:

in a 30°-60°-90° triangle, the ratio of side lengths is 1 : √3 : 2. that is, the longest side (hypotenuse) is twice the length of the shortest side.

all of the triangles in your geometry are 30°-60°-90° triangles. ac is the hypotenuse of δacd, and the short side of δabc.

the short side ad of δacd will be half the length of ac, so 3 cm. the hypotenuse ab of δabc will be twice the length of ac, so 12 cm. segment bd is the difference of the lengths ab and ad, so is

bd = ab -ad

bd = 12 cm - 3 cm = 9 cm

comment on side length ratios

you can figure the ratios of side lengths in a 30°-60°-90° triangle by considering the trig ratios of the angles. or you can figure the length of the altitude of an equilateral triangle of side length 2 using the pythagorean theorem.

Answer from: Quest

the correct answer is d. wealthy colonists to take care of the less fortunate. hope this

Another question on Business

Business, 22.06.2019 10:20

The different concepts in the architecture operating model are aligned with how the business chooses to integrate and standardize with an enterprise solution. in the the technology solution shares data across the enterprise.

Answers: 3

Answer

Business, 22.06.2019 11:10

How much are you willing to pay for a zero that matures in 10 years, has a face value of $1,000 and your required rate of return is 7%? round to the nearest cent. do not include a dollar sign in your answer. (i.e. if your answer is $432.51, then type 432.51 without $ sign)

Answers: 1

Answer

Business, 22.06.2019 18:30

What is the relationship between credit and debt?

Answers: 1

Answer

Business, 22.06.2019 23:50

Analyzing operational changes operating results for department b of delta company during 2016 are as follows: sales $540,000 cost of goods sold 378,000 gross profit 162,000 direct expenses 120,000 common expenses 66,000 total expenses 186,000 net loss $(24,000) suppose that department b could increase physical volume of product sold by 10% if it spent an additional $18,000 on advertising while leaving selling prices unchanged. what effect would this have on the department's net income or net loss? (ignore income tax in your calculations.) use a negative sign to indicate a net loss answer; otherwise do not use negative signs with your answers. sales $answer cost of goods sold answer gross profit answer direct expenses answer common expenses answer total expenses answer net income (loss) $answer

Answers: 1

Answer

You know the right answer?

The current dividend yield on Clayton's Metals common stock is 3.2 percent. The company just paid a...

Questions