B) Sales Budget is the answer.
Answer:
a. $26.67
b. 2.50%
Explanation:
a. Computation of the current value of the stock is given below:-
Price of stock ÷ Required rate of return - Growth rate
= $1.20 ÷ (0.07 - 0.025)
= $1.20 ÷ 0.045
= $26.67
b. Computation of capital gains yield on this stock is shown below:-
= Required rate - Dividend yield
= 7% - ($1.20 ÷ $26.67)
= 7% - 0.04499
= 2.50%
Answer:
The expected rate of return on this investment is:
21%
Explanation:
Cost of computer = $200,000
Annual cash flows for 5 years = $48,271
Total cash flows = $241,355 ($48,271 x 5)
Returns = $41,355 ($241,355 - $200,000)
The expected rate of return = Returns/Costs * 100
or the average of returns and the average of investments (they yield the same results)
Using the total returns and investment:
= $41,355/$200,000 * 100
= 21%
Using the average returns and investment:
= $8,271/$40,000 * 100
= 21%
Answer:
It gives proper credit to the author, it helps you avoid plagiarism, and it helps to create more ideas in your mind.
<span>add materially to a company's technological capabilities, strengthen the company's competitive position, and/or boost its profitability.</span>
