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
yanalaym [24]
3 years ago
15

When different invest Assume​ Evco, Inc. has a current stock price of $ 50.00 and will pay a $ 2.00 dividend in one​ year; its e

quity cost of capital is 15 %. What price must you expect Evco stock to sell for immediately after the firm pays the dividend in one year to justify its current​ price
Business
1 answer:
Yakvenalex [24]3 years ago
5 0

Answer:

The correct answer is $55.5.

Explanation:

According to the scenario, the given data are as follows:

Stock Price = $50

Dividend  = $2

Equity cost   = 15%

So, we can calculate the Price of the stock after 1 year by using following formula:

Stock Price = ( Dividend + Stock price after 1 year) ÷ ( 1 +  Equity cost)

By putting the value we get

$50 = ($2 + Stock price after 1 year) ÷ ( 1 + 0.15 )

Stock price after 1 year = [$50 × 1.15] - $2

= $55.5

You might be interested in
If the maker of a note does not pay at maturity, __________.
ira [324]
The maker. Hope this helps. :)
3 0
3 years ago
Suppose you're pitching in a softball game and facing a good hitter. you remember that you struck her out with a fastball the la
WARRIOR [948]
<span>When you make this decision, you are primarily using your critical thinking. You are using information you were given in the past and applying it to future events.</span>
8 0
3 years ago
After several profitable years running her business, Ingrid decided to acquire the assets of a small competing business. On May
umka2103 [35]

Answer:

question

1. how much amortization expense on the goodwill can Ingrid deduct in year 1,  year 2, year 3?

2. In lieu of the original facts, assume that Ingrid purchase only a phone list with a useful life of 5 years for $16,500.

How much amortization expense on the phone list can Ingrid deduct in year 1, year 2 and year 3?

Explanation:

The explanation is shown in the file attached. Thank you i hope it helps

Download docx
3 0
3 years ago
At the beginning of the school year, Craig Kovar decided to prepare a cash budget for the months of September, October, November
Naddika [18.5K]

Answer:

The answer is attached for ease of understanding and reference.

Explanation:

Download xlsx
5 0
3 years ago
Here is some price information on Fincorp stock. Suppose that Fincorp trades in a dealer market. Bid Ask 55.25 55.50 a. Suppose
kobusy [5.1K]

Answer:

$55.50

Explanation:

The bid price is $55,25 is the price applicable to investors would intend to sell their investment.

The ask price is $55.50 is the price applicable to investors who wish to acquire the Fincorp stock.

The prices have been computed in such a  way that the broker will always gain, whether an investor is buying or selling his/her stake.

Conclusively, the order given to the broker to buy at market would be executed at the ask price of $55.50, not the other way round.

8 0
3 years ago
Other questions:
  • Havermill co. establishes a $470 petty cash fund on september 1. on september 30, the fund is replenished. the accumulated recei
    5·1 answer
  • Zook company is a wholesaler that buys footballs and then sells them to other businesses, such as sports authority and target. t
    14·1 answer
  • Which of the following is specifically designed to increase the long run aggregtae suply curve?
    15·1 answer
  • The two most widely used methods for determining the cost of inventory are
    11·1 answer
  • Which of the following is a function of online analytical processing? Group of answer choices feeding vast amounts of informatio
    6·1 answer
  • Assuming no employees are subject to ceilings for their earnings, Harris Company has the following information for the pay perio
    9·1 answer
  • 1) Which of these is a social goal of any economic system?
    15·1 answer
  • Goods costing rs 10000 was sold at loss rs 2000<br> make journal entry​
    15·1 answer
  • Lionel works for a company that is trying to reduce travel time for their employees and allow more people to work from home. Wha
    5·1 answer
  • the common stock of salazar insurance pays a constant annual dividend of $4.80 per share. what is one share of this stock worth
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!