1. If you own 50 shares and the company declared a 22% stock dividend, how...

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Finance

1. If you own 50 shares and the company declared a 22% stock dividend, how much would you receive?

Assume you think a boom and a recession are equally likely to happen, a 50-50 chance of either.

State of Economy

Probability of State of Economy

Security Returns if State Occurs

Security L

Security U

Recession

0.50

-20%

30%

Boom

0.50

70%

10%

Based on the above information, what is a standard deviation for Security L?

3.

Assume you think a boom and a recession are equally likely to happen, a 50-50 chance of either.

State of Economy

Probability of State of Economy

Security Returns if State Occurs

Security L

Security U

Recession

0.50

-20%

30%

Boom

0.50

70%

10%

Based on the above information, what is a standard deviation for Security U?

Select one:

4. You observe a stock price of $82.45. You expect a dividend growth rate of 2% and the most recent dividend just paid was $8.25. What is required return?

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