Dream Homes Corporation had net earnings of $200,000 this past year and paid $80,000 in dividends on the company's equity of $1,800,000.Dream Homes had 500,000 shares outstanding throughout the entire fiscal year, with a current market value of $5 per share.What is the firm's present value of growth opportunities (PVGO)if the required rate of return is 10.08%?

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The present value of growth opportunities (PVGO) can be calculated using the formula: PVGO = Price - [Earnings / (Required Rate of Return)], where Price is the current market value per share, Earnings is the earnings per share (EPS), and the Required Rate of Return is given.First, calculate the EPS: EPS = Net Earnings / Shares Outstanding = $200,000 / 500,000 = $0.40.Then, calculate the no-growth value per share: No-Growth Value = EPS / Required Rate of Return = $0.40 / 0.1008 = $3.96825.Finally, calculate PVGO: PVGO = Price - No-Growth Value = $5 - $3.96825 = $1.03175.However, given the options provided, it seems there might have been a mistake in the calculation or interpretation of the options. Based on the standard approach to calculating PVGO and the options available, none of the options directly match the calculated value. The closest option based on standard calculation methods would be $0.77, but this does not align with the calculated value. It's important to review the calculation steps and ensure the correct formula and inputs are used. If the question intended to use a different approach or there was a specific context provided for calculating PVGO that differs from the standard method, that context would be crucial for selecting the correct option from the list provided.

Dream Homes Corporation Had Net Earnings of $200,000 This Past