Amid the frenzy surrounding pokemon go, nintendo stock soared during mid-july 2016 reaching a high of $38.25 on july 18. on july 24, 2016, nintendo announced that it expected earnings per share to be $0.36 over the following year. as a result, analysts estimated the dividend per share to be $0.21 next year. we can estimate the expected return on nintendo stock using an asset pricing model such as the capm. suppose that the risk-free rate is 2.4% and that the expected return on the market is 6.4%.
using the discount rate calculated in part (a), calculate the value of a share of nintendo stock if it pays a dividend of $0.21 per share (each year) forever. (round your answer to nearest cents. for example, if your answer is $42.231, write 42.32.)

Anew equipment has been proposed by engineers to increase the productivity of a certain manual welding operation. the investment cost is $25,000, and the equipment will have a market value of $5,000 at the end of a study period of five years. increased productivity attributable to the equipment will amount to $10,000 per year after operating costs have been subtracted from the revenue generated by the additional production. if marr is 10%, is investing in this equipment feasible? use annual worth method.

Suppose you win a small lottery and have the choice of two ways to be paid: you can accept the money in a lump sum or in a series of payments over time. if you pick the lump sum, you get $2,950 today. if you pick payments over time, you get three payments: $1,000 today, $1,000 1 year from today, and $1,000 2 years from today. 1) at an interest rate of 6% per year, the winner would be better off accepting the (lump sum / payments over time), since it has the greater present value. 2) at an interest rate of 9% per year, the winner would be better off accepting the (lump sum / payments over time), since it has the greater present value. 3) years after you win the lottery, a friend in another country calls to ask your advice. by wild coincidence, she has just won another lottery with the same payout schemes. she must make a quick decision about whether to collect her money under the lump sum or the payments over time. what is the best advice to give your friend? a) the lump sum is always better. b) the payments over time are always better. c) it will depend on the interest rate; advise her to get a calculator. d) none of these answers is good advice.

Labor unions have used which of the following to win passage of favorable laws such as shorter work weeks and the minimum wage? a. strikes b. collective bargaining c. lobbying d. lockouts