Answer:
44
Explanation:
according to the constant dividend growth model
price = d1 / (r - g)
d1 = next dividend to be paid
r = cost of equity
g = growth rate
2.2 / 0.1 - 0.05 = 44
Answer:
The Sherman Antitrust Act.
Explanation:
The Sherman Antitrust Act was enacted by the federal on 2nd July 1890. The act was passed in response to the growing competition among the business. The act was named after Senator John Sherman the proponent of the act. The act prohibited charging of unfair prices on farmers and merchants and favoriting large companies.
This act restrained the growth of monopolies who were practices that were trying to stop free trade.
<u>It was an anti-trust act; trusts were the big business markets from which stakeholders would transfer theirs on a single trustee. This created a monopoly in the market disabling other companies</u>.
So, the correct answer is the Sherman Antitrust Act of 1890.
Answer:
Accounting rate of return = 20.53%
Explanation:
<em>The accounting rate of return is the average annual income expressed as a percentage of the average investment.</em>
The simple rate of return can be calculated using the two formula below:
Accounting rate of return
= Annual operating income/Average investment
× 100
Average investment = (Initial cost + scrap value)/2
= 30,000/2= 15,000
Accounting rate of return = ( 3080/15,000) × 100
= 20.53%
Accounting rate of return = 20.53%
Answer:
The correct answer is option B.
Explanation:
The rate of interest is given at 7%.
The rate of inflation is given at 3%.
This implies that the purchasing power is decreasing by 3% due to inflation. But it is also rising by 7% due to interest rate.
Since the increase in purchasing power is greater than decrease. After repayment the lender will have more purchasing power than he/she loaned out.
Answer and Explanation:
Economic Growth can be defined as an increment in production capacity of an economy using all its available resources. The PPF illustrates the largest possible quantity of goods and services a nation can produce base on its available resources. An outward shift in the economy’s production possibility frontier (PPF) depicts a raise in productive capacity of an economy. An outward shift implies that an economy has capacity to increase its production outputs. This can be as a result of the economy employing new technology, allowing specialization, increasing its labour force, using new production approaches etc. Likewise, an inward shifting PPF implies an economy has witness a loss or exhaustion of some of its scarce resources and it will culminate into reduction in an economy’s productive potential.
Effects of saving and investment upon national GDP
level of savings direct related to the level of investment, investment feeds on available finance from saving. If more people save, the banks will be able to lend more to firms to support their investments.
low savings and investment implies a PPF inward shift. low savings in economy implies that the economy is opting for short-term consumption over long-term investment, and this will lead to future undue pressure on available infrastructures ad resources.
spending on consumer goods vs capital goods effect on the economy
In the short run, the economy must prefer using available resources to produce capital rather than consumer goods. Standards of living will be affected, as private consumption will have access to fewer resources. However, in the longer run, the raised production of capital goods will boost the production of more consumer goods ad therefore standards of living will experience more increase than they would have witness if the economy had spent most of its income on consumer goods.