FIN 100 Week 6 Chapter 10 Homework
Ch 10 P22:
The Fridge – Air Company’s preferred stock pays a dividend of $4.50
per share annually. If the
required rate of return on comparable quality preferred stocks is 14%
, calculate the value of
Fridge-Air’s preferred stock.
Ch 10 P23:
The Joseph Company has a stock issue that pays a fixed dividend of $3.00
per share annually.
Investors believe the nominal risk-free rate is 4%
and that this stock should have a risk premium
. What should be the value of this stock?
Ch 10 P24:
The Lo Company earned $2.60
per share and paid a dividend of $1.30