Waiting for answer This question has not been answered yet. You can hire a professional tutor to get the answer.
QUESTION
Consolidated Pasta is currently expected to pay annual dividends of$10 a share perpetuity on the 1.7 million shares that are outstanding.
Consolidated Pasta is currently expected to pay annual dividends of$10 a share perpetuity on the 1.7 million shares that are outstanding. Shareholders require a 10% rate of return from Consolidated stock. What is the total market value of its equity?
Solution Total market value of share = Market value of a share x No. of outsanding sharesMarket value of stock = Dividend/rate of return=$10/10%= $100 per shareTotal market value of equity =...