FIN 419 ASSIST Perfect Education/fin419assist.cofi FIN 419 ASSIST Perfect Education/fin419assist.cofi | Page 48

c. an investor wants a 10% return?
d. an investor wants a 13% return?
e. an investor wants a 20% return?
15. Using Yahoo! Finance (http://finance.yahoo.com/) and ticker
symbol PEP, find
PepsiCo’s historical dividend payment and current price. Historical
dividends are available in the historical price section. Use these
payments to find the annual
dividend growth rate. (If you have a quarterly pattern be sure to
annualize this
quarterly growth rate.) Now, find the required rate of return for
this stock, assuming
that the future dividend growth rate will remain the same and the
company has an
infinite horizon. Does this return seem reasonable for PepsiCo?
Chapter 9 – Q10
10. Net present value. Lepton Industries has four potential projects,
all with an initial cost of $1,500,000. The capital budget for the year
will allow Lepton to accept only one of the four projects. Given the
discount rates and the future cash flows of each project, determine
which project Lepton should accept.