Answer:
c. $8.05
Explanation:
Calculation to determine What is the value of this stock at a required return of 16.4 percent
First step is to calculate the P2
P2 = ($1.35/.164)
P2= $8.23
Now let calculate the value of the stock
P0 = [$1.23 /1.164] + [($1.25 + 8.23)/1.164^2]
P0 = $8.05
Therefore the value of this stock at a required return of 16.4 percent is $8.05
Answer:
Ans. A) NPV= -$9306
Explanation:
Hi, the first thing we need to do is to find the after-tax cost of the firm's capital, and since all capital sources are expressed in terms of after-tax percentage, we just multiply each proportion of capital by its costs, I mean
Long term Debt (7%) * 25% +Preffered Stock(11%)*15% + Common Stock(15%)*60%
The answer to this is 12.40%.
Now, we can find the net present value of this project by using the following formula.
Since the expected cash flow takes place 5 times form year 1 to 5, and is equal to $95,450, "n" is equals to 5 and "CashFlow" is equal to $95,450.
Therefore, the NPV of this project is -$9,306, which is answer A)
Best of luck.
Answer:
c. Implement a plan of action.
Explanation:
You already made your decision, so you've already considered all the outcomes and checked whether you have the resources needed for this. So the only thing left to do is to implement the plan of action
Answer:
B.
Penetration pricing
Explanation:
Penetration pricing is a strategy that is used by new companies in a market to capture market share from more established competitors. The process is for the new company to charge a lesser price than the amount that the other companies are charging which will bring people to the new firm for patronage.
It will thus capture market share and due to the high demand, be able to make profits due to Economies of Scale.
By charging less than its competitors, the new bar's owner is most likely pursuing a Penetration Strategy.
Answer:
The correct answer is number "3": doesn't reduce quality or increase price.
Explanation:
Different groups of people within a market imply different needs and preferences pushing companies to diversify in order to fulfill them. Though, one of the main characteristics of that diversification must be accessibility. Companies expect to gain in sales thanks to the segmentation of the market but not necessarily by increasing the price of the new products being sold or decreasing their quality.
