Case 1: Lottery Winnings- Looks Can Be Deceptive!
1. If you were one of the winners, which option would you select?
To find r: FV=PV(1+r)^26
Mini Case Stock Valuation at Regan Inc.
1. Total earnings=100,000x$4.32=$432,000
Total dividends paid=$54,000 x 2=$108,000
Payout ratio= $108,000/$432,000=0.25
The companys growth rate: g= ROE x b=0.25 x 0.75=0.1875, 18.75%
Mini Case: Cash Management At Webb Corporation
1. The amount the company will have available is the future value of the transfers, which are an
The total net cash flow available in two weeks:
= (1- transaction cost) x Number of transfe