chapter9solution

chapter9solution - Problems 9-1 D0 = \$1.50 g1-3 = 7 gn = 5...

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Problems 9-1 D 0 = \$1.50; g 1-3 = 7%; g n = 5%; D 1 through D 5 = ? D 1 = D 0 (1 + g 1 ) = \$1.50(1.07) = \$1.6050. D 2 = D 0 (1 + g 1 )(1 + g 2 ) = \$1.50(1.07) 2 = \$1.7174. D 3 = D 0 (1 + g 1 )(1 + g 2 )(1 + g 3 ) = \$1.50(1.07) 3 = \$1.8376. D 4 = D 0 (1 + g 1 )(1 + g 2 )(1 + g 3 )(1 + g n ) = \$1.50(1.07) 3 (1.05) = \$1.9294. D 5 = D 0 (1 + g 1 )(1 + g 2 )(1 + g 3 )(1 + g n ) 2 = \$1.50(1.07) 3 (1.05) 2 = \$2.0259. 9-2 D 1 = \$0.50; g = 7%; r s = 15%; 0 P ˆ = ? . 25 . 6 \$ 07 . 0 15 . 0 50 . 0 \$ g r D P ˆ s 1 0 = - = - = 9-3 P 0 = \$20; D 0 = \$1.00; g = 6%; 1 P ˆ = ?; r s = ? 1 P ˆ = P 0 (1 + g) = \$20(1.06) = \$21.20. s r ˆ = 0 1 P D + g = 20 \$ ) 06 . 1 ( 00 . 1 \$ + 0.06 = 20 \$ 06 . 1 \$ + 0.06 = 11.30%. r s = 11.30%. 9-6 D p = \$5.00; V p = \$60; r p = ? r p = p p V D = \$60.00 \$5.00 = 8.33%. 9-7 V p = D p /r p ; therefore, r p = D p /V p . a. r p = \$8/\$60 = 13.33%. b. r p = \$8/\$80 = 10.0%. c. r p = \$8/\$100 = 8.0%. d. r p = \$8/\$140 = 5.71%.

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chapter9solution - Problems 9-1 D0 = \$1.50 g1-3 = 7 gn = 5...

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