The tax rate debt and equity are 20 4 million and 16


We have a common stock which has a dividend which grows at 100 % for the first 1 year and 200% for the next 1 year. After that it rises more reasonably, but we only know it indirectly. Net profit margin, ATO and financial leverage are .02, 3 and 2 respectively. The dividend payout ratio is .4. The risk free rate, market rate and bheta unlevered is .04, .12 and 2.5 respectively. The tax rate debt and equity are 20%, $4 million and $16 million respectively. First, compute the price of the stock.

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Financial Management: The tax rate debt and equity are 20 4 million and 16
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