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  3. a) if a company pays out a dividend of $1.35 per s

A) If a company pays out a dividend of $1.35 per share and is expected...

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Finance

A)

If a company pays out a dividend of $1.35 per share and is expected to keep paying this dividend forever and the firm has a BETA=0.75, what would you expect to be the firms intrinsic value today? Assume the risk free rate is 3% and the market return is 12% (please use 5 decimal places).

B)

Value a firms share price if the firm is expected to have earnings per share of $3.50 next year and the firm has a blowback ratio of 25%. Assume the firm has dividend growth rate of 2% and the firms required rate of return is 9%.

C)

If a portfolio has a modified duration of 6.899 and interest rate change from 3.2% to 3.0% what is the expected price change? (Please write this in decimal format, write losses as negative numbers and gains as positive numbers, use 5 decimal places, for example write 2.555% as .02555)

D

If duration of a bond is 3.87 years and the current yield in the market is 2.5% what is the modified duration of this bond? (use 5 decimal places)

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