1. You own 1,020 shares of Difference Maker Company stock. The company plans on issuing a dividend of $.1.60 a share one year from today and then issuing a final liquidating dividend of $7.80 a share two years from today. Your required rate of return is 15 percent. Ignoring taxes, what is the value of your holdings in this stock?
$8,367.44
$8,006.29
$7,804.53
$7,435.01
$6,883.20
2. Yesterday, the DJIA closed at 12,309.16. The divisor is 0.123017848. Today, every one of the stocks in the index increased in value by $0.40 a share. What is the value of today's closing DJIA?
a) 12,564
b) 12,442
c) 12,367
d) 12,407
e) 12,571