Question 7-43 Solution

Question 7-43 Solution - 00 10 1000 738 34 $ 738 34 $ 012...

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1 Exercise 7-43 1. 2. P 4 = DIV 5 /(r - g) = [DIV 4 × (1 + g)] / (r - g) = ($2.0736 × 1.05)/(0.10 – 0.05) = $43.5456 0736 . 2 $ 20 . 1 00 . 1 DIV 728 . 1 $ 20 . 1 00 . 1 DIV 44 . 1 $ 20 . 1 00 . 1 DIV 20 . 1 $ 20 . 1 00 . 1 DIV 4 4 3 3 2 2 1 = × = = × = = × = = × =
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2 Exercise 7-43 3. 4.DIV 1 /P 0 = $1.20/$34.738 = 0.0345 = 3.45% 738 . 34 $ ) 10 . 1 ( 5456 . 43 $ 0736 . 2 $ ) 10 . 1 ( 728 . 1 $ ) 10 . 1 ( 44 . 1 $ 10 . 1 20 . 1 $ P 4 3 2 0 = + + + + =
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3 Exercise 7-43 5.Next year the price will be: 6.
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Unformatted text preview: % 00 . 10 1000 . 738 . 34 $ ) 738 . 34 $ 012 . 37 ($ 20 . 1 $ P Gain Capital DIV r 1 = =-+ = + = Back to Chapter 7 012 . 37 $ ) 10 . 1 ( 5456 . 43 $ 0736 . 2 $ ) 10 . 1 ( 728 . 1 $ 10 . 1 44 . 1 $ P 3 2 1 = + + + =...
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Question 7-43 Solution - 00 10 1000 738 34 $ 738 34 $ 012...

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