Question

ABC Common Stock THIS IS A MATLAB PROGRAMMING /MODELING EXERCISE INVOLVING A DETERMINISTIC MODEL: Exercise 9 (4 pts.) The per-share price of ABC common stock is $45.30 on 1 January 2018. At the end of June, ABC's Board of Directors meets and decides investment policy for the firm. A foreign investment decision in July causes an immediate $2.00 dollar drop in ABC's per-share price on 31 July 2018. And, a two-for-one stock split at the end of August 2018 immediately reduces ABC's per-share price by 50%. But at the end of October 2018, a ul conference call with Morgan Stanley equity analysts causes an immediate jump in ABC's per-share price by $3.50. constant until 1 January 2019 (that is, ABC's per-share price "birth rate" remains constant). Assume that the monthly interest rate on 1 January 2018 is 3.75%, and that this rate remains (a) What is the per-share price of ABC common stock on 1 January 2019? (b) Prepare a plot of the per-share price of ABC common stock over time, from 1 January 2018 through 1 January 2019.

Answer 1

Programming code in MATLAB::

clc;

clear all;

close all;

x=45.30

x = 45.3000

x=x-2.00

x = 43.3000

x = x - 0.5*x

x = 21.6500

x=x+3.50

x = 25.1500

interest=(45.30*3.75*1)/100 //INTEREST PAST-ONE YEAR

interest = 1.6987

x=x+interest

x = 26.8487

a=[45.30,43.30,21.65,25.15,26.84]

a = 45.3000 43.3000 21.6500 25.1500 26.8400

b=[1,7,8,10,13]

b = 1 7 8 10 13

plot(a,b)

MATLAB O/P::

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