Penyelesaian soal manajemen keuangan ter
Self test Financial Management
1. Stock A and B have the following historical returns :
Year Stock A’s Returns, rA(%) Stock B’s Returns, rB (%)
2006
(18)
(24)
2007
44
24
2008
(22)
(4)
2009
22
8
2010
34
56
a. Calculate the average rate of return for ech stock during 5 year period. Assume that
someone held a portfolio of 50 percent of Stock A and 50 percent of Stock B. What
would have been the realized rate of return on the portfolio in each year ? What would
have been the average return on the portfolio during this period ?
b. Now calculate the standard deviation of return for each stock and for the potfolio.
Use Equation 4-3a.
c. Looking at the annual returns data in the two stocks, would you guess that the
correlation coefficient between returns on the, two stocks is closer to 0.8 or to -0.8 ?
d. If you added more stock at random to the portfolio, which of the following nis the
most accurate statement of what would happen to standard deviation p
(1) standard deviation p remain constant
(2) standard deviation p would decline to somewhere in the vicinity of 20%
(3) standard deviation p would decline to zero if enough stocks were included.
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Self test Financial Management
2. ECRI Corp. Is a holding company with four main subsidiaries. The percentage of its
business coming each of the subsidiaries, and their respective betas are as follows :
Subsidiary
Percentage of Business
Beta
Electric utility
60%
0.70
Cable company
25
0.90
Real Estate
10
1.30
International/secial project 5
1.50
a.What is holding company’s beta ?
b. Assume that the risk-free rate is 6 percent and the market risk premium is 5 percent.
What is the holding company’s required rate of return ?
c. ECRI is considering a change in its strategic focus : it will reduce its reliance on the
electic utility subsidiary, so the percentage of its business from this subsidiary will be
50%. At the same time, ECRI will increase its reliance on the internationl/specia
project division, so the percentage of its business from taht subsidiary wi rise to 15
percent. Will be the shareholders; required rate return if they adopt these changes ?
3. You are palnning to invest $200,000. Two securities, A and B, are available, and you
can invest in either of them or in a portfolio with some each. You estimate that the
following probability distribution of returns are aplicable for A and B.
Security A
Security B
PA
rA
PB
RB
0.1
-10%
0.1
-30%
0.2
5
0.2
0
0.4
15
0.4
20
0.2
25
0.2
40
0.1
40
0.1
70
a. The expected return for security B is rA = 20% an
= 25.7%. Find rA and
b. Use the equation in footnote 3 to find the value of WA thah produces the minimum
risk portfolio. Assume
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= -0.5 for parts b and c.
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Self test Financial Management
c. Construct a table giving rp and
for portfolio with WA = 1.0000, 0.75, 0.50, 0.25,
0.0, minimum risk value of WA. (Hint: For WA = 0.75, rp = 16.25%, and
%; for WA = 0.5, rA = 17.5% and
= 8,5
= 11.1%; for wa = 0.25%, rp = 18.75% and
= 17.9%)
d. Graph the feasible set of portfolio and identify the efficient frontier of the feasible set.
e. Suppose your risk/return trade-off function, or indiference curve, is tangent to the
efficient set at the point where rp = 18%. Use this information, plus the graph
constructed in part d to locate (approximately) your optimal portfolio. Draw in a
reasonable indifference curve, indicate the percentage of your funds invested in each
security, and determine the optimal portfolio’s
and rp. (Hint : Estimate
and rp
graphically, and then use the equation for rp tp determine WA.)
f. Now suppose a riskless asset with a return rRF = 10% becomes available. How would
this change the investment opportunity set ? explain why the efficeint frontier
become linear.
g. Given the indifference curve in part e, would you change your potfolio ? If so, how ?
(Hint : Assume the indifernce curves are parallel)
h. What are the beta coefficients of Sticks Aand B ? (Hints : (1) Recognize that ri = r RF
+
bi (rM + rRF) and solve for bi and (2) assume that your preferences match those of
most other investors.)
4. Peenington Corp. Issued a new series of bonds on January 1, 1981. The bonds were
sold at par ($1000), have a 12 percent coupun, and mature in 30 years, on December
31, 2010. Coupon payments are made semiannually (on June 30 and December 31)
a. What was the YTM of Pennington’s bonds on Jauary 1, 1981 ?
b. What was the price of the bond on January 1, 1986, five years later, assuming that the
level of interest rates had fallen to 10% ?
c. Find the curent yild and capital gains yield on the bond on January, 1, 1986, given the
price as determined in part b ?
d. On July 1, 2004, Pennington’s bond sold for $916.42. Wahat was the YTM at that
date ?
e. What were the current yield and capital gains yield on July 1, 2004 ?
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Self test Financial Management
f. Now, assume that you purchased an outstanding Pennington bond on March 1, 2004,
when the going rate of interest was 15.5%. How large a check mustyou have written
to complete transaction ? This is hard question !
5. Ewald Company’s current stock price is $36, and its last dividend was $2.40. In view
of Edwald’s strong financial position and its consequent low risk, its required rate of
return is only 12%. If dividends are expected to grow at a constant rate, gm in future,
and if the required rate of return on the stock is 12%, what is Ewald’s expected stock
price 5 from now ?
6. Snyder Computer Chips Inc. is experiencing a period of rapid growth. Earnings and
dividend are expected to grow at a rate of 15 percent during the next 2 years, at 13
percent in the third year, and a constant rate of 6 percent thereafter. Snyder’s last
divident was %1.15 and the required rate of return on the stock is 12%
a. Calculate the value of the stock today
b. Calculate P1 and P2
c. Calculate the dividend yield and capital gains yield for years 1, 2 and 3
7. A call option on the stock of Bedrock Boulders has a market price of 7$ The stock
sells for $30 a share and the option has an exercise price of %25 a share.
a. What is the exercise value of the call option ?
b. What is the premium on the option ?
8. Which of the following events are likely to increase the market value of a call option
on a common stock ? explain
a. An increase in the stock ? explain
b. An increase in the stock’s price
c. An increase in the volatility of the stock price
d. An decrease in the time unti the option expires
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9. Longstreet Coomunication Inc. (LCI) has the following capital structure, which it
consider to be optimal : debt 25%, PS =15%, and CS = 60%. LCI’s tax rate is 40% and
investors expect earnings and dividens to grow a constant rate is 40% and investors
ecxpect earnings and dividends to grow a constant rate of 6% in the future. LCI paid a
dividend of $3.70 per share last year (D0), and its stock currently sells ata price of $60
per share. Treasury bonds yield 6 percent the market risk premium is 5%, and LCI’s.
Preferred : New preferred could be sold to the public at a price $100 per share, with a
dividend of 9%. Flotation costs of 5% per share would be, Debt could be sold at an
interest rate of 9%
a. Find the componenet cost of debt, preferred stock, and common stock
b. Assume LCI does not have issue any additional shares of common stock
c. What the WACC
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1)
a.
b.
c.
d.
Year
2006
2007
2008
2009
2010
Average Return
Standar Deviation
Correlation Coefficient
Stock A's
Returns,
rA(%)
Stock B's
Return,
rb(%)
-18
44
-22
22
34
-24
24
4
8
56
12
30.27
13.6
29.34
Portofolio
(%)
-21
34
-9
15
45
12.8
27.88
0.8
Jika kita menambahkan saham secara acak di portofolio maka yang akan terjadi
adalah standar deviasi akan turun sekitar 20% dari titik semula.
2)
Subsidiary
Percentage Of Business
Electric
60%
Cable Company
25%
Rale Estate
10%
International/Special
5%
Project
a. Holding Companys Beta
b. Holding Company'S Rate of return
c.
Subsidiary
Percentage Of Business
Electric
50 %
Cable Company
25 %
Rale Estate
10 %
International/Special
Project
15 %
Holding Companys Beta
Holding Company'S Rate of return
Beta
0.7
0.9
1.3
1.5
Beta
0.7
0.9
1.3
1.5
0.42
0.225
0.13
0.075
0.85
10.25
0.35
0.225
0.13
0.225
0.93
10.65
Jadi, sebagai pemegang saham saya akan menyetujui perubahan strategi fokus
perusahaan karena terjadi peningkatan risk of return yang asalnya 10.25% menjadi
10.65%
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Self test Financial Management
3)
Sekuritas A
P(A)
0.1
0.2
0.4
0.2
0.1
Sekuritas B
r(A)
-10
5
15
25
40
E(r)
-1
1
6
5
4
15
a.
b.
Porsi A
70 %
0.008
0.014
0.007
0.084
8.426
625
100
0
100
625
Porsi B
30 %
0.006
0.014
62.5
20.0
0.0
20.0
62.5
165
12.85
P(B)
0.1
0.2
0.4
0.2
0.1
r(B)
-30
0
20
40
70
E(r)
-3
0
8
8
7
20
0.014
4) Dik :
= 12 % × $ 1.000 = $ 120
= $ 1.000
= $ 1.000 (harga perkiraan)
- n = 30 tahun
Dit : YTM ?
Jawab :
a. YTM
=
=
=
b. Dik :
- C
- n
- i
= 0,12 = 12 %
= (12 % / 12) × $ 1.000
= 30 × 12 = 60 – 10 = 50
= (10 % / 2) = 5 % = 0,05
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250
80
0
80
250
660
25.7
Self test Financial Management
Dit : PV ?
Jawab :
PV = 60 ×
+
= 1.095,4 + 87,2
= 1.182,6
c. Current yield and Capital gains:
Current Yield = Annual Coupon / PV
= $ 120 / $ 1.182,6
= 0,1014
= 10,15 %
Capital Gains = 10 % - 10,5 %
= - 0,15 %
d. Dik :
= 12 % × $ 1.000 = $ 120
= $ 1.000
= $ 916,42
- n = 23,5 × 2 = 47 / 60 – 47 = 13
Dit : YTM ?
Jawab :
YTM
=
=
=
=
= 0,13 = 13 %
e. Current yield and Capital gains:
Current Yield = Annual Coupon / PV
= $ 120 / $ 916,42
= 13,09
= 13,1 %
Capital Gains = 13 % - 13,1 %
= - 0,1 %
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Self test Financial Management
f. Dik :
- C = (12 / 2) × $ 1.000 = $ 10
- n = 13,66
- i = (15,5 % / 20) = 7,75 = 0,0775 = 0,08
Dit : PV ?
Jawab :
PV = 60 ×
+
= 488,69 + 348,41
= 837,1
5) Dik :
- Current stock price
- Last deviden
- Rate of return
Dit:
Jawab :
= $ 36
= $ 2,4
= 12 % ⇾ 0,12
=
36 =
4,32 – 36
= 2,4 + 2,4
4,32 – 2,4 = (2,4 + 36)
1,92 = 38,4
=
= 0, 0505 = 5,05 %
=
= 36
= 36
= 36 (1,2793)
= 46,0548
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6) Calculate the PV of dividend paid during the supernormal growth period :
a.
= $ 1,15 (1,15) = $ 1,3225
= $ 1,3225 (1,15) = $1,5209
= $1,5209 (1,13) = $ 1,7186
PV of dividend = $ 1,3225 (0,8929) + $ 1,5209 (0,7972) + $ 1,7186 (0,7972)
= $ 1,1809 + $ 1,2125 + $ 1,2233
= $ 3,62
Find the PV of Snyder’s stock price of the end year 3 :
=
=
=
–
–
= $ 30,36
PV of
= $ 30,36 (
= $ 21,61
Now sum the two components to find the value of the stock today :
= $ 3,62 + $ 21,61
= $ 25,23
b.
= $1,5209 (0,8929) + $ 1,7186 (0,7972) + $ 30,36 (0,7972)
= $ 1,3580 + $ 1,3710 +$ 24,203
= $ 26,93
= $ 1,7186 (0,8929) + $ 30,36 (0,8929)
= $ 1,5345 + $ 27,1084
= $ 28,64
c. Calculate the dividend yield and capital gains yield for Years 1, 2. And 3 :
Year
1
2
3
Dividend Yield
Capital Gains Yield
$ 1,3225/ $ 25,23 = 5,24
%
$ 1,5209/ $ 26,93 = 5,65
%
$ 1,718 / $ 28,64 = 6,00
%
($ 26,93-$ 25,23)/ $ 25,23 =
6,74 %
($ 28,64-$ 26,93)/ $ 26,93 = 6,35
%
($ 30,36-$ 28,64)/ $ 28,64 =
6,00 %
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Total
Return
12 %
12 %
12 %
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Self test Financial Management
7) Opinions :
a. The exercise value of the call option is $ 25 + $ 7 = $ 32. It’s the value to stock
must rise to, in order to make a profit.
b. The current intrinsic value of the option is $ 30 - $ 25 = $ 5. It’s the worth of the
opinion if it would expire “today”. As the market price is $ 7, the difference $ 7 $5 = $ 2 represents the opition’s time value.
9) Dik :
- Debt
- Preferred stock
- Commond stock
- Tax Rate
- Expect earnings
- LCI dividend
- Stock currently sell price
- Treasury bonds : - yield
- average
= 25 %
= 15 %
= 60 %
= 40 %
=6%
=$ 3,6
= $ 60
=6%
=5%
Dit : Cost of debt, preffered stock, and commond stock ?
Jawab :
a. Cost of Debt :
T = 40 % ⇾ 0,4
Rd = 9 %
Rd (1 – T) = 9 % ( 1 – 0,4)
= 9 % (0,6)
= 5,4 %
Cost of Preffered Stock :
Dividend
Price
=$9
= $ 100
KPS
=
=9%
Cost of commond stock :
F
g
= $ 5 (flotation cost)
= $ 3,6
= 60 % - 6 % = 54 %
=6%
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Self test Financial Management
Div 1 =
KE
=
KE
=
KE
=
KE
=
KE
= 13,06 %
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+9
+9
+ 0,06
+ 0,06
Page 12
1. Stock A and B have the following historical returns :
Year Stock A’s Returns, rA(%) Stock B’s Returns, rB (%)
2006
(18)
(24)
2007
44
24
2008
(22)
(4)
2009
22
8
2010
34
56
a. Calculate the average rate of return for ech stock during 5 year period. Assume that
someone held a portfolio of 50 percent of Stock A and 50 percent of Stock B. What
would have been the realized rate of return on the portfolio in each year ? What would
have been the average return on the portfolio during this period ?
b. Now calculate the standard deviation of return for each stock and for the potfolio.
Use Equation 4-3a.
c. Looking at the annual returns data in the two stocks, would you guess that the
correlation coefficient between returns on the, two stocks is closer to 0.8 or to -0.8 ?
d. If you added more stock at random to the portfolio, which of the following nis the
most accurate statement of what would happen to standard deviation p
(1) standard deviation p remain constant
(2) standard deviation p would decline to somewhere in the vicinity of 20%
(3) standard deviation p would decline to zero if enough stocks were included.
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Self test Financial Management
2. ECRI Corp. Is a holding company with four main subsidiaries. The percentage of its
business coming each of the subsidiaries, and their respective betas are as follows :
Subsidiary
Percentage of Business
Beta
Electric utility
60%
0.70
Cable company
25
0.90
Real Estate
10
1.30
International/secial project 5
1.50
a.What is holding company’s beta ?
b. Assume that the risk-free rate is 6 percent and the market risk premium is 5 percent.
What is the holding company’s required rate of return ?
c. ECRI is considering a change in its strategic focus : it will reduce its reliance on the
electic utility subsidiary, so the percentage of its business from this subsidiary will be
50%. At the same time, ECRI will increase its reliance on the internationl/specia
project division, so the percentage of its business from taht subsidiary wi rise to 15
percent. Will be the shareholders; required rate return if they adopt these changes ?
3. You are palnning to invest $200,000. Two securities, A and B, are available, and you
can invest in either of them or in a portfolio with some each. You estimate that the
following probability distribution of returns are aplicable for A and B.
Security A
Security B
PA
rA
PB
RB
0.1
-10%
0.1
-30%
0.2
5
0.2
0
0.4
15
0.4
20
0.2
25
0.2
40
0.1
40
0.1
70
a. The expected return for security B is rA = 20% an
= 25.7%. Find rA and
b. Use the equation in footnote 3 to find the value of WA thah produces the minimum
risk portfolio. Assume
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= -0.5 for parts b and c.
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Self test Financial Management
c. Construct a table giving rp and
for portfolio with WA = 1.0000, 0.75, 0.50, 0.25,
0.0, minimum risk value of WA. (Hint: For WA = 0.75, rp = 16.25%, and
%; for WA = 0.5, rA = 17.5% and
= 8,5
= 11.1%; for wa = 0.25%, rp = 18.75% and
= 17.9%)
d. Graph the feasible set of portfolio and identify the efficient frontier of the feasible set.
e. Suppose your risk/return trade-off function, or indiference curve, is tangent to the
efficient set at the point where rp = 18%. Use this information, plus the graph
constructed in part d to locate (approximately) your optimal portfolio. Draw in a
reasonable indifference curve, indicate the percentage of your funds invested in each
security, and determine the optimal portfolio’s
and rp. (Hint : Estimate
and rp
graphically, and then use the equation for rp tp determine WA.)
f. Now suppose a riskless asset with a return rRF = 10% becomes available. How would
this change the investment opportunity set ? explain why the efficeint frontier
become linear.
g. Given the indifference curve in part e, would you change your potfolio ? If so, how ?
(Hint : Assume the indifernce curves are parallel)
h. What are the beta coefficients of Sticks Aand B ? (Hints : (1) Recognize that ri = r RF
+
bi (rM + rRF) and solve for bi and (2) assume that your preferences match those of
most other investors.)
4. Peenington Corp. Issued a new series of bonds on January 1, 1981. The bonds were
sold at par ($1000), have a 12 percent coupun, and mature in 30 years, on December
31, 2010. Coupon payments are made semiannually (on June 30 and December 31)
a. What was the YTM of Pennington’s bonds on Jauary 1, 1981 ?
b. What was the price of the bond on January 1, 1986, five years later, assuming that the
level of interest rates had fallen to 10% ?
c. Find the curent yild and capital gains yield on the bond on January, 1, 1986, given the
price as determined in part b ?
d. On July 1, 2004, Pennington’s bond sold for $916.42. Wahat was the YTM at that
date ?
e. What were the current yield and capital gains yield on July 1, 2004 ?
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Self test Financial Management
f. Now, assume that you purchased an outstanding Pennington bond on March 1, 2004,
when the going rate of interest was 15.5%. How large a check mustyou have written
to complete transaction ? This is hard question !
5. Ewald Company’s current stock price is $36, and its last dividend was $2.40. In view
of Edwald’s strong financial position and its consequent low risk, its required rate of
return is only 12%. If dividends are expected to grow at a constant rate, gm in future,
and if the required rate of return on the stock is 12%, what is Ewald’s expected stock
price 5 from now ?
6. Snyder Computer Chips Inc. is experiencing a period of rapid growth. Earnings and
dividend are expected to grow at a rate of 15 percent during the next 2 years, at 13
percent in the third year, and a constant rate of 6 percent thereafter. Snyder’s last
divident was %1.15 and the required rate of return on the stock is 12%
a. Calculate the value of the stock today
b. Calculate P1 and P2
c. Calculate the dividend yield and capital gains yield for years 1, 2 and 3
7. A call option on the stock of Bedrock Boulders has a market price of 7$ The stock
sells for $30 a share and the option has an exercise price of %25 a share.
a. What is the exercise value of the call option ?
b. What is the premium on the option ?
8. Which of the following events are likely to increase the market value of a call option
on a common stock ? explain
a. An increase in the stock ? explain
b. An increase in the stock’s price
c. An increase in the volatility of the stock price
d. An decrease in the time unti the option expires
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9. Longstreet Coomunication Inc. (LCI) has the following capital structure, which it
consider to be optimal : debt 25%, PS =15%, and CS = 60%. LCI’s tax rate is 40% and
investors expect earnings and dividens to grow a constant rate is 40% and investors
ecxpect earnings and dividends to grow a constant rate of 6% in the future. LCI paid a
dividend of $3.70 per share last year (D0), and its stock currently sells ata price of $60
per share. Treasury bonds yield 6 percent the market risk premium is 5%, and LCI’s.
Preferred : New preferred could be sold to the public at a price $100 per share, with a
dividend of 9%. Flotation costs of 5% per share would be, Debt could be sold at an
interest rate of 9%
a. Find the componenet cost of debt, preferred stock, and common stock
b. Assume LCI does not have issue any additional shares of common stock
c. What the WACC
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Self test Financial Management
1)
a.
b.
c.
d.
Year
2006
2007
2008
2009
2010
Average Return
Standar Deviation
Correlation Coefficient
Stock A's
Returns,
rA(%)
Stock B's
Return,
rb(%)
-18
44
-22
22
34
-24
24
4
8
56
12
30.27
13.6
29.34
Portofolio
(%)
-21
34
-9
15
45
12.8
27.88
0.8
Jika kita menambahkan saham secara acak di portofolio maka yang akan terjadi
adalah standar deviasi akan turun sekitar 20% dari titik semula.
2)
Subsidiary
Percentage Of Business
Electric
60%
Cable Company
25%
Rale Estate
10%
International/Special
5%
Project
a. Holding Companys Beta
b. Holding Company'S Rate of return
c.
Subsidiary
Percentage Of Business
Electric
50 %
Cable Company
25 %
Rale Estate
10 %
International/Special
Project
15 %
Holding Companys Beta
Holding Company'S Rate of return
Beta
0.7
0.9
1.3
1.5
Beta
0.7
0.9
1.3
1.5
0.42
0.225
0.13
0.075
0.85
10.25
0.35
0.225
0.13
0.225
0.93
10.65
Jadi, sebagai pemegang saham saya akan menyetujui perubahan strategi fokus
perusahaan karena terjadi peningkatan risk of return yang asalnya 10.25% menjadi
10.65%
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Self test Financial Management
3)
Sekuritas A
P(A)
0.1
0.2
0.4
0.2
0.1
Sekuritas B
r(A)
-10
5
15
25
40
E(r)
-1
1
6
5
4
15
a.
b.
Porsi A
70 %
0.008
0.014
0.007
0.084
8.426
625
100
0
100
625
Porsi B
30 %
0.006
0.014
62.5
20.0
0.0
20.0
62.5
165
12.85
P(B)
0.1
0.2
0.4
0.2
0.1
r(B)
-30
0
20
40
70
E(r)
-3
0
8
8
7
20
0.014
4) Dik :
= 12 % × $ 1.000 = $ 120
= $ 1.000
= $ 1.000 (harga perkiraan)
- n = 30 tahun
Dit : YTM ?
Jawab :
a. YTM
=
=
=
b. Dik :
- C
- n
- i
= 0,12 = 12 %
= (12 % / 12) × $ 1.000
= 30 × 12 = 60 – 10 = 50
= (10 % / 2) = 5 % = 0,05
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Page 7
250
80
0
80
250
660
25.7
Self test Financial Management
Dit : PV ?
Jawab :
PV = 60 ×
+
= 1.095,4 + 87,2
= 1.182,6
c. Current yield and Capital gains:
Current Yield = Annual Coupon / PV
= $ 120 / $ 1.182,6
= 0,1014
= 10,15 %
Capital Gains = 10 % - 10,5 %
= - 0,15 %
d. Dik :
= 12 % × $ 1.000 = $ 120
= $ 1.000
= $ 916,42
- n = 23,5 × 2 = 47 / 60 – 47 = 13
Dit : YTM ?
Jawab :
YTM
=
=
=
=
= 0,13 = 13 %
e. Current yield and Capital gains:
Current Yield = Annual Coupon / PV
= $ 120 / $ 916,42
= 13,09
= 13,1 %
Capital Gains = 13 % - 13,1 %
= - 0,1 %
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Self test Financial Management
f. Dik :
- C = (12 / 2) × $ 1.000 = $ 10
- n = 13,66
- i = (15,5 % / 20) = 7,75 = 0,0775 = 0,08
Dit : PV ?
Jawab :
PV = 60 ×
+
= 488,69 + 348,41
= 837,1
5) Dik :
- Current stock price
- Last deviden
- Rate of return
Dit:
Jawab :
= $ 36
= $ 2,4
= 12 % ⇾ 0,12
=
36 =
4,32 – 36
= 2,4 + 2,4
4,32 – 2,4 = (2,4 + 36)
1,92 = 38,4
=
= 0, 0505 = 5,05 %
=
= 36
= 36
= 36 (1,2793)
= 46,0548
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Self test Financial Management
6) Calculate the PV of dividend paid during the supernormal growth period :
a.
= $ 1,15 (1,15) = $ 1,3225
= $ 1,3225 (1,15) = $1,5209
= $1,5209 (1,13) = $ 1,7186
PV of dividend = $ 1,3225 (0,8929) + $ 1,5209 (0,7972) + $ 1,7186 (0,7972)
= $ 1,1809 + $ 1,2125 + $ 1,2233
= $ 3,62
Find the PV of Snyder’s stock price of the end year 3 :
=
=
=
–
–
= $ 30,36
PV of
= $ 30,36 (
= $ 21,61
Now sum the two components to find the value of the stock today :
= $ 3,62 + $ 21,61
= $ 25,23
b.
= $1,5209 (0,8929) + $ 1,7186 (0,7972) + $ 30,36 (0,7972)
= $ 1,3580 + $ 1,3710 +$ 24,203
= $ 26,93
= $ 1,7186 (0,8929) + $ 30,36 (0,8929)
= $ 1,5345 + $ 27,1084
= $ 28,64
c. Calculate the dividend yield and capital gains yield for Years 1, 2. And 3 :
Year
1
2
3
Dividend Yield
Capital Gains Yield
$ 1,3225/ $ 25,23 = 5,24
%
$ 1,5209/ $ 26,93 = 5,65
%
$ 1,718 / $ 28,64 = 6,00
%
($ 26,93-$ 25,23)/ $ 25,23 =
6,74 %
($ 28,64-$ 26,93)/ $ 26,93 = 6,35
%
($ 30,36-$ 28,64)/ $ 28,64 =
6,00 %
Saddam Husin 1301026226
Total
Return
12 %
12 %
12 %
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Self test Financial Management
7) Opinions :
a. The exercise value of the call option is $ 25 + $ 7 = $ 32. It’s the value to stock
must rise to, in order to make a profit.
b. The current intrinsic value of the option is $ 30 - $ 25 = $ 5. It’s the worth of the
opinion if it would expire “today”. As the market price is $ 7, the difference $ 7 $5 = $ 2 represents the opition’s time value.
9) Dik :
- Debt
- Preferred stock
- Commond stock
- Tax Rate
- Expect earnings
- LCI dividend
- Stock currently sell price
- Treasury bonds : - yield
- average
= 25 %
= 15 %
= 60 %
= 40 %
=6%
=$ 3,6
= $ 60
=6%
=5%
Dit : Cost of debt, preffered stock, and commond stock ?
Jawab :
a. Cost of Debt :
T = 40 % ⇾ 0,4
Rd = 9 %
Rd (1 – T) = 9 % ( 1 – 0,4)
= 9 % (0,6)
= 5,4 %
Cost of Preffered Stock :
Dividend
Price
=$9
= $ 100
KPS
=
=9%
Cost of commond stock :
F
g
= $ 5 (flotation cost)
= $ 3,6
= 60 % - 6 % = 54 %
=6%
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Self test Financial Management
Div 1 =
KE
=
KE
=
KE
=
KE
=
KE
= 13,06 %
Saddam Husin 1301026226
+9
+9
+ 0,06
+ 0,06
Page 12