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Fin 534 Homework Answer Key

HOMEWORK SET 3 or show your work if a mathematical calculation is needed, or both. Submit your assignment using the assignment link in the course shel . This homework assignment is worth 100 points. YOU MUST ENTER CORRECT INFORMATION IN THE YELLOW-CODED CELLS DO NOT TOUCH THE NON-YELLOW-CODED CELLS ANSWERS ARE IN THE RED-BORDERED CELLS Use the following information for questions 1 through 8: The Goodman Industries' and Landry Incorporated's stock prices and dividends, along with the Market Index, are shown below. Stock prices are reported for December 31 of each year, and dividends reflect those paid during the year. The market data are adjusted to include dividends. Goodman Industries Landry Incorporated Market Index Year Dividend Dividend Includes 2013 $25.88 $1.73 $73.13 $4.50 17.49 5.97 2012 22.13 1.59 78.45 4.35 13.17 8.55 2011 24.75 1.50 73.13 4.13 13.01 9.97 2010 16.13 1.43 85.88 3.75 9.65 1.05 2009 17.06 1.35 90.00 3.38 8.40 3.42 2008 11.44 1.28 83.63 3.00 7.05 8.96 1. Use the data given to calculate the annual returns for Goodman, Landry, and the Market Index, and then calculate average annual returns for the two stocks and the index. (Hint: Remember, returns are calculated by subtracting the beginning price from the ending price to get the capital gain or loss, adding the dividend to the capital gain or loss, and then dividing the result by the beginning price. Assume that dividends are already included in the index, Also, you cannot calculate the

HOMEWORK SET 5 or show your work if a mathemaTcal calculaTon is needed, or both. Submit your assignment using the assignment link in the course shell. ±his homework assignment is worth 100 points. YOU MUST ENTER CORRECT INFORMATION IN THE YELLOW-CODED CELLS DO NOT TOUCH THE NON-YELLOW-CODED CELLS ANSWERS ARE IN THE RED-BORDERED CELLS Use the following informa±on for Ques±ons 1 through 3: Boehm CorporaTon has had stable earnings growth of 8% a year for the past 10 years and in 2013 Boehm paid dividends of $2.6 million on net income of $9.8 million. However, in 2014 earnings are expected to jump to $12.6 million, and Boehm plans to invest $7.3 million in a plant expansion. ±his one-Tme unusual earnings growth won't be maintained, though, and aFer 2014 Boehm will return to its previous 8% earnings growth rate. Its target debt raTo is 35%. Calculate Boehm's total dividends for 2014 under each of the following policies. 1. Its 2014 dividend payment is set to force dividends to grow at the long-run growth rate in earnings.

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