solution
Consolidated Postais
currently expected to pay annua dividends of 510 share in perpetulty on the 20
million shares that are outstanding Shareholders require a state of return from
Consolidated stock
What is the price of
Consoldated stock? (Do not round Intermediate calculation)
What is the total market
value of its equity? (Inter your answer in millions) Market value of our
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Order Paper NowConsolidated now decides
to increase next year’s dividend to $20 a share without changing the investment
or borrowing plans Thereafter the company will revert to its policy of
distributing $10 million a year
c. How much new equity capital will the
company need to raise to finance the extra dividend payment? (Enter your answer
in millions.)
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