Finance Ch 8 HW

The Garden Shoppe has adopted a policy of increasing the annual dividend on its common stock at a constant rate of 1.65 percent annually. The firm just paid an annual dividend of $1.84. What will the dividend be eight years from now?

$2.10

Gee-Gee's is going to pay an annual dividend of $2.05 a share on its common stock next year. This year, the company paid a dividend of $2 a share. The company adheres to a constant rate of growth dividend policy. What will one share of this common stock be worth five years from now if the applicable discount rate is 10.9 percent?

$27.61

Whistle Stop pays a constant annual $8 dividend on its stock. The company will maintain this dividend for the next 8 years and will then cease paying dividends forever. What is the current price per share if the required return on this stock is 12.6 percent?

$38.92

Currently, a firm has an EPS of $2.54 and a benchmark PE of 16.4. Earnings are expected to grow 3.8 percent annually. What is the estimated current stock price?

$41.66

A stock pays a constant annual dividend and sells for $56.07 a share. If the market rate of return on this stock is 12.2 percent, what is the amount of the next annual dividend?

$6.84

Which one of the following types of stock is defined by the fact that it receives no preferential treatment in respect to either dividends or bankruptcy proceedings?

Common

An agent who maintains an inventory from which he or she buys and sells securities is called a:

Dealer.

Jen owns 30 shares of stock in Delta Fashions and wants to win a seat on the board of directors. The firm has a total of 100 shares of stock outstanding. Each share receives one vote. Presently, the company is voting to elect three new directors. Which one of the following statements must be true given this information?

If cumulative voting applies, Jen is assured one seat on the board.

Which one of the following statements applies to NASDAQ?

Multiple market maker system.

A securities market primarily composed of dealers who buy and sell for their own inventories is referred to which type of market?

Over-the-counter.