Answer: $43
Explanation:
The current stock price will be calculated as:
= Do(1 - g) / (Ke + g)
where,
Do = $ 4.90
g = 2.50%
Ke = 8.60%
Po = [4.90 - (1 - 0.025)] / [0.086 + 0.025]
Po = 4.7775 / 0.111
Po = $43
The price of one share of the stock today will be $43
Answer:
$37,000 and $13,000
Explanation:
The computation of the accounting profit and the economic profit is shown below:
Accounting profit = Total revenue - explicit cost
where,
Explicit cost = cost of helper + annual rent + material cost
= $12,000 + $5,000 + $20,000
= $37,000
So, the accounting profit is
= $72,000 - $37,000
= $35,000
And, the economic profit is
= Revenue - explicit cost - implicit cost
where,
Implicit cost = renting equipment + working for competitor + worth of entrepreneurial talents
= $4,000 + $15,000 + $3,000
= $22,000
So, the economic profit is
= $35,000 - $22,000
= $13,000
If you look at the information in the question, you'll notice that the return is less than the cost of borrowing (loan interest rate) (ATIRR). This indicates that there is negative leverage and that the property cannot utilise it.
Positive leverage would be created in the first year if the property was purchased with expected returns equivalent to leverage.
Financial leverage is the process of using borrowed money (debt) to buy assets in the expectation that the income from the new asset or capital gain would outweigh the cost of borrowing. The leverage is summed up in this idea. By using debt (loan money), or leverage, we mean to increase the profits on an investment or project.
Leverage allows investors to increase their market buying power.
Leverage is a tool used by businesses to finance their assets. Rather than issuing stock to raise money, businesses can use debt to finance operations in an effort to boost shareholder value.
The most popular financial leverage ratios to determine how hazardous a company's position is are debt-to-assets and debt-to-equity.
To know more about Leverage visit:
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It is in california
has universal studios
has hollywood
has disney world
has legoland
has sea world
Answer:
The number of degrees of freedom and the right-hand tail area α.
Explanation:
Chi Square Distribution
α is Significance level
If the p-value of hypothesis test < α , then we reject null hypothesis of the test.
So, α is basically a critical p-value which makes a rejection region in the right tail
Now, the statistic χ 2 also depends on the degrees of freedom
So, The value of χ2α in a particular situation depends on
the number of degrees of freedom and the right-hand tail area α.