The common stock of Big Birds Unlimited has a required return of 8 percent and a growth rate of 4 percent. The last annual dividend was $.60 a share. What is the current price of this stock?

Activist investors need to buy a controlling interest in a firm in order to force exact change

Indicate whether the statement is true or false

An all-equity firm with 200,000 shares outstanding, Antwerther Inc, has $2,000,000 of EBIT, which is expected to remain constant in the future. The company pays out all of its earnings, so earnings per share (EPS) equal dividends per shares (DPS). Its tax rate is 40%. The company is considering issuing $5,000,000 of 10.0% bonds and using the proceeds to repurchase stock. The risk-free rate is

6.5%, the market risk premium is 5.0%, and the beta is currently 0.90, but the CFO believes beta would rise to 1.10 if the recapitalization occurs. Assuming that the shares can be repurchased at the price that existed prior to the recapitalization, what would the price be following the recapitalization? a. $65.77 b. $69.23 c. $72.69 d. $76.33 e. $80.14