1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
yawa3891 [41]
1 year ago
10

starskeep, inc., is a fast-growing technology company. the firm projects a rapid growth of 40 percent for the next two years and

then a growth rate of 20 percent for the following two years. after that, the firm expects a constant-growth rate of 8 percent. the firm expects to pay its first dividend of $1.25 a year from now. if your required rate of return for such stocks is 20 percent, what is the current price of the stock?
Business
1 answer:
tino4ka555 [31]1 year ago
3 0

When the required rate of return for such stocks is 20 percent, the current price of the stock is 15.63.

<h3>What is stock?</h3>

Stock in finance refers to all of the shares that make up a corporation's or company's ownership. A single share of stock represents fractional ownership of the corporation based on the total number of shares. A stock is a broad term that refers to any company's ownership certificates.

The price will be calculated thus:

D1 = 1.25

D2 = 1.25 × (11+.40)

D3 = 1.25 × (1+.40) × (1+.20)

D4 = 1.25 × (1+.40) × (1+.20)^2

P4 = 1.25 × (1+.40) × (1+.20)^2 × (1+.08)/(.20 - .08)

Note that d is the dividend.

Current Stock Price = 1.25/(1+.20)^1 + 1.25*(1+.40)/(1+.20)^2 + 1.25*(1+.40)*(1+.20)/(1+.20)^3 + 1.25*(1+.40)*(1+.20)^2/(1+.20)^4 + 1.25*(1+.40)*(1+.20)^2*(1+.08)/(.20 - .08)*(1+.20)^4 = 15.625 or 15.63

Therefore, the current price is 15.63.

Learn more about stock on:

brainly.com/question/25818989

#SPJ1

You might be interested in
Shanice is a new project manager working with a preexisting team that has resisted many of the new policies she has put into pla
motikmotik

Answer: Shanice is conving the team that their behavior will harm the company since it will disturb Research and Development projects, specially concerning time and energy management. By taking this step, <u>in a non-aggressive way she is demanding that the team takes new attitudes towards their jobs and the project itself.</u>

5 0
3 years ago
Gavin is a salesperson for an advertising company. He sells ads to customers directly.
wariber [46]

Answer:

Personal selling.

Explanation:

Promotion is a method of informing and persuading customer to buy product or service or idea. Every company in the market use some or other promotional strategy to penetrate in the market. Corporate have different needs or objective of promotion, like creating awareness, spreading information, increasing sales, increase market share, retaining loyal customer, etc. There are different method of promotion also been used by corporates to achieve their objective according to the budget, time and place of promotion. There are few promotion method used by corporate are: Advertising, sales promotion, personal selling, e-commerce, public relation, and social media.

Personal selling: It is a part of promotional mix, where salesperson sell the product or service to their target customer directly by meeting them personally.

6 0
3 years ago
What term was coined by Goldman Sachs in 2001 to describe the fastest growing market economies?
julsineya [31]

BRICS is an acronym for the economies of Brazil, Russia, India, China, and South Africa combined, which in 2001 were the fastest growing major economies in the world.

3 0
3 years ago
While preparing your risk responses, you identify additional risks. What should you do? Add reserves to the project to accommoda
saw5 [17]

Answer: Document the risk and calculate the expected monetary value based on the probability and impact of the occurrences.

Explanation:

Risk response refers to the development of strategic options to reduce the threats and enhance opportunities to the objectives of the project.

It should be noted that when new risks are identified, such risks go through the process of risk management and one needs to be able to know the risk probability and risk impact and then get to curtail them.

8 0
3 years ago
Robinson's has 24,000 shares of stock outstanding with a par value of $1 per share and a market price of $40 a share. The balanc
Zina [86]

Answer:

Find attached question with multiple choices

The third option ,72,000 shares, is the correct answer.

Explanation:

A stock split refers to redenomination of shares by increasing the number of shares and proportionately reducing the number par value per share.

A 3-1 share split means that one prior share now commands three shares while the price of one share is apportioned between the three shares

Robinson now 3/1*24,000 shares=72,000 shares

One previous share was $1 par value but the three new shares would $1/3=$0.33 per share instead of the previous $1 par value

Download xlsx
7 0
3 years ago
Other questions:
  • how often is simple interest used in the business and banking worlds? a. rarely, d. regularly, c. frequently, d. most...
    8·1 answer
  • Sue, a resident of the state of New York, is visiting her aunt in Iowa. On her way, her car is hit by Jerry, a resident of the s
    12·1 answer
  • ________ staff the phones, conduct internet live chats, and respond to e-mail and solve customer or employee problems. helpdesk
    14·1 answer
  • Webster and Moore paid $148,000, in cash, for equipment three years ago. At the beginning of last year, the company spent $21,00
    8·1 answer
  • In order to hire graduates and postgraduates of microbiology, Arthur, the human resource (HR) manager at Kartholfen, a pharmaceu
    13·1 answer
  • Whats a marketing plan
    13·1 answer
  • Assume an organization's cost of capital is 10% and Division X has operating income of $3 million and uses $20 million of capita
    8·1 answer
  • which of the following should be avoided when solving a problem? A) Assessing B)Compromising C) Procrastinating D) Projecting
    5·1 answer
  • PLEASE HELP ASAP::::
    15·1 answer
  • Which of the following do brands with strong brand equity NOT necessarily have?
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!