Details of this Paper

Why is there a cost to retained earnings in investor-owned business

Description

solution


Question

Question;Why is there a cost to RETAINED earnings in investor-owned business?What are the three methods commonly used to estimate the cost of equity?Is the risk premium in the CAPM the same as the risk premium in the debt-cost-plus-risk-premium model?How would you estimate the cost of equity (FUND capital) for a not-for-profit business?How would you estimate the cost of equity for a small investor-owned business?Assume the risk-free rate is 6 percent and the market risk premium is 6 percent. TheSTOCKof Physicians CareNETWORK (PCN) has a beta of 1.5. The last dividend paid by PCN (D0) was $2 per share.- What would PCN's stock value be if the dividend was expected to grow at a constant:- 5 %?0 %?5 %?10%?- What would be the stockvalue if the growth rate is 10 Percent, but PCN's beta falls to1.0?0.5?

 

Paper#48991 | Written in 18-Jul-2015

Price : $27
SiteLock