Math  /  Word Problems

QuestionFawlty Foods paid a \$1.40 dividend, closing price \$21, required return 12%. Find growth rate, dividend yield, and capital gains yield.

Studdy Solution
Calculate the capital gains yield.
Capitalgainsyield=0.120.067=0.053Capital\, gains\, yield =0.12 -0.067 =0.053So, the expected capital gains yield is5.%.
a. The implied growth rate in dividends is6%. b. The expected dividend yield is6.7%. c. The expected capital gains yield is5.%.

View Full Solution - Free
Was this helpful?

Studdy solves anything!

banner

Start learning now

Download Studdy AI Tutor now. Learn with ease and get all help you need to be successful at school.

ParentsInfluencer programContactPolicyTerms
TwitterInstagramFacebookTikTokDiscord