$\'s year 1 million 12.76 11.14 9.57 9.46 2.9 3.09.5 11.6 $\'s year 0 million Ba

Question

$'s year 1 million 12.76 11.14 9.57 9.46 2.9 3.09.5 11.6 $'s year 0 million Based on the figure above fill in the following blanks. In period 1 the firm will pay a dividend of 9.57 million dollars to the investor. The investor will then invest/borrow million dollars of their period 0 dividend, which will generate a cash flow/require a cash repayment on this investment of one cash available for the investor to spend is millions of dollars, contain two decimal places, and the minus sign for borrowing and repayment. For example, if your answer is 9 million dollars, you will write 9.00. If you want to borrow 900,000, write-0.90. Follow standard million dollars. All of this means that the total period million dollars. Your answer must be in

Explanation / Answer

1. 9.46

2.

Dividend company will pay in period 0 = 3

Dividend investor require now = 2.9

Funds from period investor will invest = 3 - 2.9 = 0.1

3.

Total value investor will have = 9.57

Company dividend at t=1 = 9.46

Cash generated = 9.57 - 9.46 = 0.11

4. Total cash investor have is = 9.57

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