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Lilit [14]
1 year ago
5

hudson corporation will pay a dividend of $2.80 per share next year. the company pledges to increase its dividend by 7.40 percen

t per year indefinitely. if you require a return of 15.40 percent on your investment, how much will you pay for the company's stock today? multiple choice $32.59 $33.60 $11.43 $35.00 $36.40
Business
1 answer:
trapecia [35]1 year ago
3 0

Option d. $35.00 is the share price that one should pay for the stock today to get the required return

The share price, or the price you will pay for the company's stock right now, can be calculated using the necessary rate of return calculation, the formula is as follows:

RRR=(EDP/SP)+DGW

where;

RRR=required rate of return

EDP=expected dividend payment from share

SP=share price

DGW=dividend growth rate

In our case:

RRR=15.40%=15.4/100=0.154

EDP=$2.80

SP=unknown

DGW=7.40%=7.40/100=0.074

Substituting the values in the formula we get the following:

0.154=(2.80/SP)+0.074

(0.154-0.074)=(2.80/SP)

0.08=2.80/SP

SP=2.80/0.08

So, the share price of the stock=$35

Learn more about dividends:

brainly.com/question/28044310

#SPJ4

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These are the factors by how it shifts the current demand curve to a new position:

Shifts left

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7 0
3 years ago
1. Descriptive statistics ________. quickly describe large amounts of data can predict future stock returns with surprising accu
nika2105 [10]

Answer:

1. quickly describe large amounts of data

2. the stock is worth 15% more at the end of the year than at the beginning

3. 9.2%

Explanation:

Descriptive statistics helps to quickly describe large amounts of data because it simply involves using certain measurement tools to describe the data seen such that patterns emerge that will help in analyzing the data. Examples include, frequency tables and measures of variation like range and standard deviation.

When a stock has a 15% return, it means that the owner is getting 15% more than the amount that the stock cost them therefore showing that the stock is worth 15% more at the end of the year than at the beginning.

The return on the stock is;

= (4.75 - 4.35) / 4.35

= 9.2%

3 0
3 years ago
Sierra owns a small business and handles many responsibilities, from logistics to marketing. She's seen a lot of success with Go
LUCKY_DIMON [66]

Answer:

Smart display campaign

Explanation:

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In other words , it automates the process of bidding ,targeting and creating advert.

Even though the initial set up can be costly , but it reduces the effort of advertisers to the minimum as the whole process is programmed to self controlling.

As such , it is recommended for Sierra's business.

4 0
3 years ago
Which answer applies to "fine print"?
Kay [80]

Answer:

D. All of the Above

hope this helps!

6 0
3 years ago
A ______________________ is created each time the federal government spends more than it collects in taxes in a given year.
Vlad [161]

Answer:

Budget deficit / Fiscal deficit

Explanation:

At the start of the year, every government prepares a budget e.g. all sources of revenue (direct taxes, indirect taxes, aids etc) and projected expenses are also mentioned (development of society, defense etc.).

When a government spends more than its revenue from taxes so it means that government is running a budget deficit or a fiscal deficit which are covered through fiscal measures by government e.g. increasing taxes or reducing public spending.

8 0
3 years ago
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