This is for financial mathematics, please help me, thank you very much for your help! 2. Mary owns common stock in Carl's Pooch Place. The annual dividend is $1.87. The currentprice is $6.81. What is the yield of the stock?

When the company receives profits and distributes them among the shareholders. That share of profit…

Answered: 2. Mary owns common stock in Carl's…

2. Mary owns common stock in Carl's Pooch Place. The annual dividend is $1.87. The current price is $6.81. What is the yield of the stock?

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter7: Stocks (equity) - Characterstics And Valuation

Section: Chapter Questions

Problem 2PROB

See similar textbooks

Related questions

Q: Chloe Jones has determined the following information about her own financial situation. Her checking…

A: Checking account balance=$850Saving Account=$1,200Market value of…

Q: An investor has $2,215 invested in stock A and $3,826 in stock B. The daily volatilities of A and B…

A: Value at Risk refers to the maximum amount that investment in the portfolio will lose with the given…

Q: Identify 3 advantages of the Value investing. 50% Stocks 20% Dividend Stock 20% Bonds 10% Other…

A: Value investing-It is an investing strategy where an investor tries to buy stocks, bonds, or other…

Q: Bill needs to determine the equivalent value in 1 quarter of a payment of $1200 due in 3.33…

A: The concept of TVM refers to the interest-earning capacity of money which makes money earned earlier…

Q: Taussig Corp.'s bonds currently sell for $1,140. They have a 6.35% annual coupon rate, a $1,000 par…

A: Some bonds have an option to be called before the maturity by payment of premium and hence these…

Q: Based on the data below, how much abnormal return did the portfolio manager achieve due to its…

A: Given information,Benchmark return on stock: Benchmark return on bonds: Benchmark return on cash:…

Q: The stock price of BAC is currently $120 and a put option with strike price of $120 is $5. A trader…

A: Here,Current price is $120Strike price is $120Premium is $5Strategies:-1. 300 Shares of BAC2. 3…

Q: A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a…

A: Given:

Q: The Optical scam company has forecast a sales growth of 20 percent for next year. The current…

A: External Financing Needed (EFN) describes the extra capital or money that a business needs to…

Q: Preferred stock is similar to a bond because: it pays a fixed periodic amount it has no maturity…

A: The preferred stock refers to the capital that is raised which has characteristics of both equity…

Q: You are considering investing in Dakota's Security Services. You have been able to locate the…

A: The Equity Multiplier is a financial metric that measures the amount of a firm's assets that are…

Q: ngiers Limited has just arranged to purchase a K400,000 vacation home in the Bahamas with a 20…

A: In mortgage loans if the borrower wants to pay loan after sometime then can pay the outstanding loan…

Q: The real rate of interest is 5,20% and inflation is expected to be 3,60% for the next three years. A…

A: Variables in the question:Real rate of interest=5.20%Inflation for the next 3 years=3.60%3 year…

Q: A rich aunt has promised you $1,000 one year from today. In addition, each year after that, she has…

A: Present value of any investment or payments is the sum total of discounted values of all the cash…

Q: ect has multiples rates of return (i.e., multiple values of IRR), it means that the project is…

A: IRR is the internal rate of return and is the break even rate of return at which the present value…

Q: You have just entered college and have decided to pay for your living expenses using a credit card…

A: An equal amount paid each period is known as annuity. The future value is the accumulated value of…

Q: A U.S. firm holds an asset in France and faces the following scenario: State 1 State 2 State 3…

A: Here, StateExchange Rate per Euro (x)Probabilities (p)P*P (y)State 1 $…

Q: Under which of the following conditions could the overuse of financial leverage be detrimental to…

A: The problem statement wants to identify the conditions where the excessive use of financial leverage…

Q: Imprudential, Inc, has an unfunded pension liability of $709 million that must be paid in 10 years.…

A: Pension Liability of $709 millionTime period is 10 yearsDiscount rate is 5%To Find:Present Value of…

Q: Michael and Chloe are saving for their daughter Laylah's college education. Laylah just turned 10…

A: Current Tuition Fees is $15,500Inflation Rate is 3.5%Interest Rate is 8%Current Savings is…

Q: Your firm spends $403,000 per year in regular maintenance of its equipment. Due to the economic…

A: Capital budgeting provides various modern methods to evaluate the potential of the projects. The…

Q: Nielson Motors (NM) has no debt. Its assets will be worth $600 million in one year if the economy is…

A: The expected return is the estimation of profit or loss that an investor determine from his…

Q: Big Red is also considering taking on a five-year contract with Standard Refining to distribute…

A: Net Present Value is also known as NPV. It is a capital budegting techniques which help in decision…

Q: Wildhorse, Inc., has four-year bonds outstanding that pay a coupon rate of 6.4 percent and make…

A: Compound = n = Semiannually = 2Time = nper = 4 * 2 = 8Coupon Rate = 6.4 / 2 = 3.2%Current Price of…

Q: Atlas spends $327,800 a week to pay bills and maintains a lower cash balance limit of $50,000. The…

A: Baumol-Tobin (BAT) model - This model is used to determine the optimal cash balance for a company.…

Q: forward contract has an underlying asset which, in Cox-RossRubenstein notation, has S=22,u=1.2 and…

A: Forward contract is a contract that is to be settled in the future based on a specific price and…

Q: Given a 5% simple interest rate, how long does it take to double your money?

A: In finance there are two main types of interest rate – simple interest rate and compound interest…

Q: Abbreviated financial statements for Archimedes Levers are shown in the table below. Assume sales…

A: a. Growth rate = 19%Dividend payout ratio = 55% Retention ratio, b =The average total assets is The…

Q: 1. Which project(s) should Capital Invest Inc. undertake during the upcoming year if it has only…

A: Capital Budgeting- Capital budgeting is the method in which various investments are analysed and the…

Q: uppose you are a British venture capitalist holding a major stake in an e-commerce start-up in…

A: Exchange risk, also known as currency risk or foreign exchange risk, is the risk that an investor or…

Q: (Liquidity Analysis) The King Carpet Company has $3,150.000 in cash and a total of $12,480,000 in…

A: The current ratio shows the paying capacity to meet short-term liabilities with the available amount…

Q: Suppose a U.S. multinational company needs to buy Canadian dollar but the exchange rate between US…

A: The cross-exchange rate refers to the rate that is calculated between two currencies through a third…

Q: 1. Mr. Sosa borrowed Php. 1,500,000 for the purchase of a car. If his monthly payment is Php.27,000…

A: We take loans to buy expensive things like a house or a car which otherwise we could not have bought…

Q: How much will Sarah save in a money market account earning 5.2% interest per year if she opened the…

A: Annuity refers to a stream of constant and usually fixed cash flows. Here the monthly deposit of…

Q: 3. Susie bought a $1000 corporate bond. The bond pays 6.4% interest per year. If Susie holds the…

A: Bonds are debt instruments issued by companies. A company can raise its finances or funding either…

Q: Suppose you have some money to invest-for simplicity, $1-and you are planning to put a fraction w…

A: The problem case focuses on calculating the return and standard deviation of the portfolio. The mean…

Q: Nelco Inc. has decided in favour of a capital structuring that involves increasing its existing $80…

A: EPS means earnings per share.If there are no taxes ,EPS = whereEBIT = Earnings before interest and…

Q: 11. Consider a 2 year Treasury note. The bond pays coupons annually, with coupon rate 10% (the par…

A: The market interest rate of a bond also known as the yield to maturity of the bond is an expected…

Q: Jilk Incorporated's contribution margin ratio is 61% and its fixed monthly expenses are $48,500.…

A: Contribution margin is selling price per unit less variable cost per unit for a product.Contribution…

Q: The market volatility is 25%. Firm A and Firm B have volatilities of 50.1% and 24.8%, respectively.…

A: The beta of a stock refers to the measure of systematic risk that the company faces. It is used in…

Q: Compute the firm's 2016 net operating income and net income. Calculate the firm's operating return…

A: Net Operating income= Operating Income - Interest ExpenseOperating Income = Revenue x Operating…

Q: Consider the following alternatives: i. $100 received in one year ii. $220 received in 5 years iii.…

A: Present value of amount is computed by following formula:-PV = wherePV = present value of amountFV…

Q: . Use the one-period valuation model P = E/(1 + k) + P1/(1 + k) to price the following stocks…

A: Variables in the question: Earnings (E = $)Required return (k=%)Expected Price Next…

Q: Chandler Sporting Goods produces baseball and football equipment and lines of clothing. This year…

A: 1.company's net working capital = Total current assets - Total current liabilities2. Total current…

Q: have been asked to provide an anticipated cap rate and vacancy rate for a pro forma of a subject…

A: Cap rate is the required rate of return and depends on the value of property and net operating…

Q: PharmaPlus operates a chain of 30 pharmacies. The pharmacies are staffed by licensed pharmacists and…

A: Given:p = Number of full time equivalent pharmacists.T = Number of full time equivalent…

Q: Economic consideration is being given for a proposal to build out a new business. All capital and…

A: Net present value:It is calculated by multiplying the future value by one and dividing it by (1+r)…

Q: Consider a bond with a 8% coupon and a yield to maturity of 5% maturing in just over 2 Suppose the…

A: Price of a bond is the sum of the flat price of the bond plus accrued interest on the bond and that…

Q: Suppose you invest $2,500 in a fund earning 15% simple interest. Further suppose that you have the…

A: As per the problem we are required to calculate the simple interest on the deposited amount for a…

Q: Find the present value of $700 due in the future under each of these conditions: a. 6% nominal rate,…

A: Since you have posted a question with multiple sub-parts, we will provide the solution only to the…

Concept explainers

Stock Yields

The stock yield is otherwise known as the dividend yield. The dividend yield is an annual payment of the stock dividends to the holder of a firm’s stock. The dividend yield is a financial ratio to measure the value of dividend payout every year for the relative stock price. The yield of a stock is usually shown in a percentage that discloses the expected future earnings from stock depending on the current stock price in the future. Stock yield will change depending on the market fluctuations and in accordance with the market fluctuations, the dividends will be increased or decreased by the firm.

Question

This is for financial mathematics, please help me, thank you very much for your help!

2. Mary owns common stock in Carl's Pooch Place. The annual dividend is $1.87. The current
price is $6.81. What is the yield of the stock?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1: Introduction

VIEW

Step 2: Computation of Yield of Stock

VIEW

Solution

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

Last year, Julie Johnson bought one share of common stock for $950. During the year, Julie received a $60.50 dividend. Earlier today, she sold the stock for $976. What rate of return did Julie earn on her investment? Round your answer to two decimal places. _______ % What were the dividend yield and the capital gains yield associated with holding the stock? Round your answers to two decimal places. Dividend yield: _______ % Capital gains yield: _______ %
4. At the beginning of the year, you purchase a share of stock for $50. Over the year the dividend paid on the stock were $2.75 per share. a. Calculate the return if the price of the stock at the end of the year is $60. b. Calculate the return if the price of the stock at the end of the year is $40.
You purchased a share of stock in The Hephaestus Company last year at $40, which paid you a $2 dividend during the year. What is your holding period return if: a. You sell the stock for $44. b. You sell the stock for $50. c. You sell the stock for $35
You purchased a share of stock for $20. One year later you received a $1 dividend and sold the share for $24. What was your holding period return?
At the start of the year, you purchased a single stock for $49.15 and one year later received a dividend of $2.88 and then sold the stock for $54.91. What was your total nominal return?
Last year, Carlotta bought five shares of Spot-Off Cleaners for $85 each. During the year, Carlotta recieved one cash dividend equal to $5.10 per share. Earlier today, she sold the stock for $88.40. (a) What rate of return did Carlotta earn on her investment? (b) What were the (1) dividend yield and (2) the capital gains tield associated with holding the stock?
You purchased a share of stock last year for $50. You collected a dividend of $1 and sold it for $52. What was the capital gains yield you earned? Group of answer choices 2.00% 6.00% 4.00% 12.00%
What is the total percentage return for an investor who purchased a stock for $8.01, received $2.02in dividend payments, and sold the stock for $9.14? Please write your answers as a percentage (e.g. .1234 should be written as 12.34)
Suppose you purchase one share of the stock of Red Devil Corporation at the beginning of year 1 for $46.50. At the end of year 1, you receive a dividend of $2, and buy one more share for $50.50. At the end of year 2, you receive total dividends of $4 (i.e., $2 for each share), and sell the shares for $58.50 each. What is the time-weighted return on your investment? (Round your answer to 2 decimal places. Do not round intermediate calculations.)
An investor purchases a stock for $50 and over the next year, receives a $0.75 dividend. At the end of the year, the stock is priced at $53. In the second year, the stock pays a $1.00 dividend and at the end of the year the stock is priced at $51. a. Compute the dollar return for each year. b. Compute the percentage return for each year.
2 Ms. Ayesha purchased 4,000 shares at Rs. 25 each on 15.10.19. She earned dividends as below: 8, 000, 9,000, 12, 000 and 14,000. She sold all her holdings at Rs. 135,000 on 15.10.23 What are her holding period returns and yields? What is annualized yield? Is Ms. Ayesha a good investor?
An investor purchases 300 shares of a stock at a price of $75 per share. During the year, the investor receives dividends of $2.34 per share and then sells all the shares at the end of the year at a price of $79.60 per share. Calculate the investor's: a. Income b. Capital gain c. Total dollar return