Subject: Financial Management
Assignment 9
Instruction: Carry out the given tasks.
Task No. 1. A stock is expected to pay a dividend of P0.75 at the end of the year. The required weight of return is
rs=10%, and the expected constant growth is g = 6%. What is the stock’s current price?
Task No. 2. ABC Corporation provided the following information:
D0 = P1.25
G =5%
P0 = P25.00
What is the stock’s expected dividend yield for the coming year?
Task No. 3. To expand its business, Kings Outlet Factory plans to issue a bond with a par value of P1,000, coupon rate of
10%, and maturity of 10 years from now. What is the value of the bond if the required rate of return is:
a. 8%
b. 10%
c. 12%
END OF TASKS