Answer:
Risk-free rate (Rf) = 8%
Return on market portfolio (Rm) = 15%
Beta (β) = 1.2
Ke = Rf + β(Rm - Rf)
Ke = 8 + 1.2(15 - 8)
Ke = 8 + 1.2(7)
Ke = 8 + 8.4
Ke = 16.40%
Earnings per share (EPS) = $10
Current dividend paid (Do) = 40% x $10 = $4
Retention rate (b) = &6/$10 x 100 = 60% = 0.6
ROE (r) = 20% = 0.2
Growth rate (g) = b x r
= 0.6 x 0.2
= 0.12 = 12%
Current market price (Po)
= Do<u>(1 + g) </u>
Ke - g
= $4<u>(1 + 0.12)</u>
0.1640 - 0.12
= $4<u>(1.12)</u>
0.044
= $101.82
Explanation:
First and foremost, we need to calculate the cost of equity based on capital asset pricing model. Then, we will determine the growth rate, which is a function of retention rate (b) and return on equity(r).
Finally, we will calculate the current market price, which is dividend paid, subject to growth, divided by the excess of cost of equity over growth rate.
Answer:
$388,000
Explanation:
Data provided
Bond certificates printed = $26,000
Legal fees paid = $110,000
CPA registration = $12,000
Underwriter commission = $240,000
The calculation of amount of bond issue costs is shown below:-
Total Bond issue costs = Bond certificates printed + Legal fees paid + CPA registration + Underwriter commission
= $26,000 + $110,000 + $12,000 + $240,000
= $388,000
<span>He has committed "twisting".</span>
<span>
Twisting is intentionally putting forth deceptive
expressions that would make a insured to lapse, appoint, or end insurance
policy with a specific end goal to switch companies or policies. It is the
demonstration of initiating or endeavor to instigate a policy owner to drop a
current policy and to take another policy by utilizing deceptions or fragmented
correlations of the focal points of the two policies.</span>
The correct answer is to provide numerous facilities based
on the western standards of living. When a continuous developing country wishes
to attract mass tourism, providing different facilities according to western
standards boosts the chances of attracting more tourists, since tourists are
easily attracted by western culture, because of their western setup or living.
Answer:
0.58
Explanation:
The sharpe ratio for any portfolio shall be determined through the following mentioned formula:
Sharpe ratio=(Rp-Rrf)/σp
Where
Rp = Return on the portfolio=
Rrf=the risk free rate of return=4.5%
σp= the standard deviation of the portfolio=25%
Applying the data in the given question to the above mentioned formula as follows:
Sharpe ratio=(19%-4.5%)/25%=0.58
