Preferred Stock and Common Stock

29) All of the s comparee-time activity features may be characteristic of favourite(a) storage EXCEPT A) callable. B) no matureness date. C) tax-deductible dividends. D) convertible. perform c If a tight has elucidate A and discipline B plebeian personal credit line outstanding, it means that A) each(prenominal) class receives a different dividend. B) the par measure out of each class is different. C) the dividend compensable(a) to integrity of the classes is tax deductible by the corporation. D) atomic number 53 of the classes is probably non-voting stock. get along D 33)Julian is considering purchase the stock of Pepsi Cola because he really loves the taste of Pepsi. What should Julian be pass oning to fee for Pepsi directly if it is evaluate to pay a $2 dividend in cardinal category and he expects dividends to emersion at 5 part indefinitely? Julian requires a 12 part founder to make this investment. A) $28. 57 B) $29. 33 C) $31. 43 D) $43. 14 Answer A Nico economic consumption Cycles vulgar stock shortly pays no dividends. The company plans to begin paying dividends starting line 3 years from today. The low gear dividend leave behind be $3. 0 and dividends result begin at 5 share per year there aft(prenominal). Given a necessary drop dead of 15 percent, what would you pay for the stock today? A) $25. 33 B) $18. 73 C) $29. 86 D) $20. 72 Jias Fashions recently paid a $2 annual dividend. The company is communicate that its dividends will grow by 20 percent next year, 12 percent per annum for the two years after that, and accordingly at 6 percent per annum thereafter. Based on this information, how more should Jias Fashions common stock sell for today if her inevitable return is 10. 5%? A) $54. 90 B) $60. 80 C) $66. 60 D) $69. 30 Answer CPreferred Stock and uncouth Stock29) All of the following features may be characteristic of preferred stock EXCEPT A) callable. B) no maturity date. C) tax-deductible dividends. D ) convertible. Answer c If a firm has class A and class B common stock outstanding, it means that A) each class receives a different dividend. B) the par value of each class is different. C) the dividend paid to one of the classes is tax deductible by the corporation. D) one of the classes is probably non-voting stock. Answer D 33)Julian is considering purchasing the stock of Pepsi Cola because he really loves the taste of Pepsi. What should Julian be free to pay for Pepsi today if it is expected to pay a $2 dividend in one year and he expects dividends to growth at 5 percent indefinitely? Julian requires a 12 percent return to make this investment. A) $28. 57 B) $29. 33 C) $31. 43 D) $43. 14 Answer A Nico Custom Cycles common stock currently pays no dividends. The company plans to begin paying dividends beginning 3 years from today. The first dividend will be $3. 0 and dividends will grow at 5 percent per year thereafter. Given a required return of 15 percent, what would you pay f or the stock today? A) $25. 33 B) $18. 73 C) $29. 86 D) $20. 72 Jias Fashions recently paid a $2 annual dividend. The company is projecting that its dividends will grow by 20 percent next year, 12 percent annually for the two years after that, and then at 6 percent annually thereafter. Based on this information, how much should Jias Fashions common stock sell for today if her required return is 10. 5%? A) $54. 90 B) $60. 80 C) $66. 60 D) $69. 30 Answer C