« previous next »

Author Question: LTM, Inc. has an issue of preferred stock whose par value is 1,000. The preferred stock pays a 4.5 ... (Read 64 times)

cookcarl

  • Hero Member
  • *****
  • Posts: 539
on: Jul 10, 2018
LTM, Inc. has an issue of preferred stock whose par value is 1,000. The preferred stock pays a 4.5
  dividend. If investors require a 5.5 rate of return for these shares, what price should the preferred
  stock sell for?
 
  A) 611.11 B) 508.33 C) 818.18 D) 409.09

Question 2

Based on analysis of the company and expected industry and economic conditions, China Imports is expected to earn 4.60 per share of common stock next year. The average price/earnings ratio for firms in the same industry is 8.
 
  Calculate the estimated value of a share of China Imports common stock.


meryzewe

  • Sr. Member
  • ****
  • Posts: 346
Reply #1 on: Jul 10, 2018
Answer to Question 1

C

Answer to Question 2

Estimated value of share price = 4.60  8 = 36.80 per share


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Anti-aging claims should not ever be believed. There is no supplement, medication, or any other substance that has been proven to slow or stop the aging process.

Did you know?

When taking monoamine oxidase inhibitors, people should avoid a variety of foods, which include alcoholic beverages, bean curd, broad (fava) bean pods, cheese, fish, ginseng, protein extracts, meat, sauerkraut, shrimp paste, soups, and yeast.

Did you know?

Cytomegalovirus affects nearly the same amount of newborns every year as Down syndrome.

Did you know?

All adverse reactions are commonly charted in red ink in the patient's record and usually are noted on the front of the chart. Failure to follow correct documentation procedures may result in malpractice lawsuits.

Did you know?

Studies show that systolic blood pressure can be significantly lowered by taking statins. In fact, the higher the patient's baseline blood pressure, the greater the effect of statins on his or her blood pressure.

W. A. Rogers’s engraving, “Out of the Game,” showed one injured boy tending to another. It appeared W. A. Rogers’s engraving, “Out of the Game,” showed one injured boy tending to another. It appeared
Newborns have a preferred head and arm orientation. Newborns have a preferred head and arm orientation.
Ozone Depletion—A Global Issue Ozone Depletion—A Global Issue
Create a soapy lather with the hands and spread the soap up to the elbows. Liquid soap is preferred. ... Create a soapy lather with the hands and spread the soap up to the elbows. Liquid soap is preferred. ...
ADHD (Stock photo) ADHD (Stock photo)
Daniel's Enterprises has a beta of 1.98 and a growth rate of 12 percent. The stock is ... Daniel's Enterprises has a beta of 1.98 and a growth rate of 12 percent. The stock is ...
Video: Fermentation pathways

For a complete list of videos, visit our video library