You are considering the purchase of a share of preferred stock that pays a $3.00 yearly dividend. There is a 20% probability that the company will go bankrupt after paying the fifth dividend (and no further cash flows occur). There is an 80% probability that the firm continues paying its dividend in perpetuity. What is the value of a share today? Assume an 8% required rate of return

Carlton industries is considering a new project that they plan to price at $74.00 per unit. the variable costs are estimated at $39.22 per unit and total fixed costs are estimated at $12,085. the initial investment required is $8,000 and the project has an estimated life of 4 years. the firm requires a return of 8 percent. ignore the effect of taxes. what is the degree of operating leverage at the financial break-even level of output?