Purchase Solution

Share Price, Dividend Discount Model, Cost of Buying, Preferred Stock

Not what you're looking for?

Ask Custom Question

- On March 14, 2013, the Dow Jones Industrial Average set a new high. The index closed at 14,539.14, which was up 83.86 points from the previous day's close of 14.455.28. What was the return (in percent to four decimal places) of the stock market for March 14, 2013?

- At your brokerage firm, it costs $9.50 per stock trade. How much money do you need to buy 300 shares of Time Warner, Inc. (TWX), which trades at $22.62?

- Financial analysts forecast Safeco Corporation (SAF) growth for the future to be a constant 10 percent. Safeco's recent dividend was $1.20. What is the value of Safeco stock when the required return is 12 percent?

- A preferred stock from Duquesne Light Company (DQUPRA) pays $2.10 in annual dividends. If the required return on the preferred stock is 5.4 percent, what is the value of the stock?

-Ultra Petroleum (UPL) has earnings per share of $1.56 and a P/E ratio of 32.48. What is the stock price?

Purchase this Solution

Solution Summary

The solution provides varied examples where return on change in Dow Jones is computed, share price using dividend discount model, value of preferred stock with given dividend, and required return and total price of buying a stock.

Solution Preview

1. Dow Jones

Return = 83.86/14,455.28 = 0.5801%

2. Brokerage firm - Total price will total share value + cost of trade.

Total Price = ...

Purchase this Solution


Free BrainMass Quizzes
Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking

Lean your Process

This quiz will help you understand the basic concepts of Lean.

Business Processes

This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.

Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

Organizational Behavior (OB)

The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.