The required rate of return on the stock of Dell company is come out to be 8.89%.
<h3>What is a stock?</h3>
Stock represents the number of shares being owned by an investor in the company on which it gets the dividends.
Given values for step 1:
The required rate of return: 12%
Beta factor: 1.40
Risk-free rate: 4.75%
<u>Step-1</u> Computation of market risk premium:
Given values for step 2:
Market risk premium: 5.18%
Beta factor: 0.80
Risk-free rate: 4.75%
<u>Step-2</u> Computation of required rate of return:
Therefore, the return of 8.89% comes out to be the required rate of return for the stock of Dell Company.
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Answer:
A decrease in inventory
Explanation:
Inventory refers to the finished goods that a company has in its warehouse, and are meant of sale. The value of inventory is recorded as a current asset. If sold on a cash basis, it converts to cash or account receivable if sold on credit.
A reduction in inventory signals that some sales transaction has happened. A sale contributes directly to the net come income of a business. Sales generate or increase cash to the business. Its a cash inflow in the cash flow statement. Reduction in inventory is, therefore, an indirect communication in the increase of net income.
Answer:
$4,000 gain
Explanation:
The computation of the tom income or loss is shown below:
= Number of shares × (market price sold - fair value of share price)
= 2,000 shares × ($12 per share - $10 per share)
= $4,000 gain
This is the answer and the same is not provided in the given options.
We simply take the difference between the market price sold and the fair value of share price and then multiply it by the number of shares so that the correct amount can come
All other information which is given is not relevant. Hence, ignored it
c. demand for that good is more elastic than if you spent a smaller portion of your income on the good.
Demand elasticity is the change in demand as the price changes - aka price has a big effect on demand.
Think about if the cost of a candy bar doubles from $1 to $2. This is a big increase but $2 isn't a huge portion of your income so it isn't a huge deal and you will probably keep buying. Now imagine if your car payment doubles from $350 to $700. Because this is such a big portion of your income, you will probably look to trade it in for a cheaper car.
A legal agreement by which a bank or other creditor lends money at interest in exchange for taking title of the debtor's property, with the condition that the conveyance of title becomes void upon the payment of the debt.
