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a. What is the value of fie slock so you, gven a required nhe of retum of 19 percere? b. shoud yeu purchase tha stock?

1 Answer

7 votes

Final answer:

The value of the stock is $536.84 million. Whether to purchase it or not depends on various factors.

Step-by-step explanation:

The value of the stock can be calculated using the formula:

Stock Value = Dividend / Required Return

Given that the required return is 19%, the value of the stock can be calculated as:

Stock Value = $102 million / 19% = $536.84 million

So, the value of the stock is $536.84 million.

Whether you should purchase the stock or not depends on various factors, such as the current market price of the stock, your own risk tolerance, and your investment goals.

It's recommended to consult a financial advisor or do thorough research before making any investment decisions.

User Sanath Meti
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