The preemptive right is crucial to shareholders since ita. Protects the present shareholders versus a dilution of their ownership interests. B. Permits managers come buy extr shares listed below the current market price.c. Protects bondholders, and thus allows the certain to concern debt with a reasonably low interest rate.d. Is consisted of in every this firm charter.e. Will an outcome in greater dividends every share.

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Companies can concern different great of typical stock. I beg your pardon of the complying with statements concerning stock great is CORRECT?a. Some class or class of usual stock room entitled to an ext votes every share than various other classes. B. All firms have several classes of common stock.c. All common stocks fall into one of three classes: A, B, and also C.d. All typical stock, nevertheless of class, need to pay the same dividend.e. All typical stocks, regardless of class, must have actually the same voting rights.
If a stock"s dividend is supposed to flourish at a continuous rate the 5% a year, i m sorry of the adhering to statements is CORRECT? The stock is in equilibrium.a. The supposed return top top the share is 5% a year.b. The price that the stock is expected to decline in the future.c. The stock"s forced return need to be same to or less than 5%.d. The stock"s dividend yield is 5%.e. The stock"s price one year from now is supposed to be 5% over the present price.
Stocks A and also B have actually the adhering to data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the following statements is CORRECT? ABRequired return 10%12%Market price $25$40Expected development 7%9%a. These two stocks must have actually the same expected year-end dividend.b. These two stocks must have the very same dividend yield.c. These two stocks must have the exact same expected resources gains yield.d. These two stocks should have actually the same price.e. These two stocks should have actually the exact same expected return.
Stock X has actually the adhering to data. Presume the stock sector is efficient and also the share is in equilibrium, i m sorry of the adhering to statements is CORRECT?Expected dividend, D1 $3.00Current Price, P0 $50Expected consistent growth price 6.0%a. The stock"s required return is 10%.b. The stock"s supposed dividend yield and growth price are equal. C. The stock"s meant dividend yield is 5%.d. The stock"s expected funding gains yield is 5%.e. The stock"s supposed price 10 years from now is $100.00.
Stocks A and B have actually the following data. The industry risk premium is 6.0% and the risk-free price is 6.4%. Presume the stock industry is efficient and the stocks space in equilibrium, which of the adhering to statements is CORRECT? ABBeta 1.100.90Constant development rate 7.00%7.00%a. Stock A must have actually a higher dividend yield than Stock B.b. Stock A must have actually a greater stock price than Stock B.c. Stock B must have the greater required return.d. Share B might have the higher expected return.e. Stock B"s dividend yield amounts to its intended dividend development rate.
Dyer Furniture is supposed to pay a dividend of D1 = $1.25 every share at the end of the year, and that dividend is expected to flourish at a consistent rate of 6.00% every year in the future. The company"s beta is 1.15, the industry risk premium is 5.50%, and also the risk-free price is 4.00%. What is Dyer"s present stock price?a. $30.36b. $28.90c. $31.12d. $29.62e. $31.90
Kellner motor Co."s stock has actually a compelled rate the return the 11.50%, and it sells because that $25.00 every share. Kellner"s dividend is meant to prosper at a constant rate the 7.00%. What was the critical dividend, D0?a. $0.95b. $1.27c. $1.40d. $1.16e. $1.05
Alcott"s preferred stock pays a dividend that $1.00 per quarter. If the price of the stock is $45.00, what is its nominal (not effective) annual rate of return?a. 8.24%b. 8.67%c. 8.45%d. 8.03%e. 8.89%
For a stock to it is in in equilibrium, that is, for there to be no irreversible pressure because that its price come depart indigenous its existing level, thena. The meant return have to be equal to both the forced future return and the previous realized return.b. The intended future return must be much less than the many recent previous realized return.c. The required return should equal the establish return in every periods.d. The past realized return need to be same to the intended return throughout the same period.e. The intended future returns have to be equal to the compelled return.
Which of the complying with statements is CORRECT?a. The constant growth version cannot be offered for a zero growth stock, where the dividend is supposed to remain continuous over time.b. If a stock has a forced rate the return rs = 12% and its dividend is meant to grow at a constant rate that 5%, this indicates that the stock"s dividend productivity is likewise 5%. C. The price that a stock is the current value of all expected future dividends, discounted in ~ the dividend development rate.d. The consistent growth version is often suitable for examining start-up providers that execute not have a stable background of growth yet are expected to reach stable growth within the next couple of years.e. The share valuation model, P0 = D1/(rs - g), have the right to be offered to value firms whose dividends room expected to decrease at a continuous rate, i.e., to flourish at a an adverse rate.

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You, in analyzing a stock, discover that its intended return exceeds its forced return. This suggests that girlfriend thinka. The stock need to be sold.b. Dividends space not most likely to be declared.c. The stock is a an excellent buy. D. Management is most likely not trying come maximize the price every share.e. The share is enduring supernormal growth.
$35.50 every share is the current price for Foster Farms" stock. The dividend is projected to boost at a consistent rate of 5.50% per year. The required rate of return top top the stock, rs, is 9.00%. What is the stock"s intended price 3 year from today?a. $40.85b. $41.69c. $39.83d. $37.86e. $38.83
Carby Hardware has superb issue of perpetual preferred stock with an yearly dividend the $7.50 per share. If the forced return on this wanted stock is 6.5%, at what price must the desired stock sell?a. $104.27b. $106.95c. $109.69d. $112.50e. $115.38
Burke Tires just paid a dividend the D0 = $1.32. Experts expect the company"s dividend to thrive by 30% this year, by 10% in Year 2, and at a constant rate of 5% in Year 3 and thereafter. The forced return top top this low-risk share is 9.00%. What is the best estimate the the stock"s current market value?a. $44.87b. $43.75c. $45.99d. $42.65e. $41.59
Orwell building supplies" critical dividend was $1.75. The dividend development rate is expected to be constant at 25% because that 2 years, after i m sorry dividends space expected to prosper at a price of 6% forever. Its compelled return (rs) is 12%. What is the best estimate that the current stock price?a. $41.58b. $42.64c. $43.71d. $44.80e. $45.92
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