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Vesna [10]
3 years ago
12

ART has come out with a new and improved product. As a result, the firm projects an ROE of 27%, and it will maintain a plowback

ratio of 0.20. Its earnings this year will be $4.0 per share. Investors expect a 15% rate of return on the stock. What price do you expect ART shares to sell for in 4 years
Business
1 answer:
emmasim [6.3K]3 years ago
4 0

Answer:

$41.14

Explanation:

Dividend per share=$4

Divided=1-retained profits=1-.2=.8

Cost of equity=15%

Growth rate=27%*.2=5.4%

The formula is;

Current Stock price=Dividend/(cost of equity-growth rate)

Current stock price=4(1-.2)/(.15-.27*.2)=$33.33

Share price after 4 year will be=$33.33(1+.27*.2)^4=$41.14

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A company making tires for bikes is concerned about the exact width of its cyclocross tires. The company has a lower specificati
ANEK [815]

Answer:

the process capability index for the process is 0.4761

Explanation:

The computation of the process capability index for the process is shown below:

= minimum of [(23.3-23.1) ÷ (3 × 0.14),(23.1 - 22.8) ÷ (3 × 0.14)]

= minimum of (0.4761, 0.7142)

= 0.4761

Hence, the process capability index for the process is 0.4761

The same should be considered and relevant  

4 0
2 years ago
Suppose that Australia imposes a tariff on imported beef. If the increase in producer surplus is $100 million, the increase in t
hram777 [196]

Answer: False

Explanation:

A tariff is a tax that is imposed by the government of a particular country in order to curtail the number of imported goods brought into the country.

Based on the above scenario, the reduction in consumer surplus is not $500 million but rather $600 million which is the addition of $100 million, $200 million and $300 million.

Therefore the question is false.

6 0
3 years ago
Which two advantages do renters have that home buyers don’t have?
bazaltina [42]
<span>C) Renters don’t have to pay for major repairs to the property.</span>
7 0
3 years ago
Read 2 more answers
A static budget is one that shows estimated revenues and costs at multiple activity levels. true or false
maxonik [38]

Answer:

A static budget is one that shows estimated revenues and costs at multiple activity levels.

True

Which of the following is not typically found in a decentralized organization?

Asset center

Explanation:

3 0
3 years ago
Fashion, Inc. had a Retained Earnings balance of $16,000 at December 31, 2021. The company had an average income of $6,500 over
avanturin [10]

Answer:

Total amount of dividends paid over the last three years is $20500

Explanation:

The net income of the company is either retained in the company or paid out as dividends. To calculate the value of the ending retained earnings, we use the following formula,

Ending balance = Beginning balance + Net Income - Dividends

We first need to calculate the total net income for the 3 year period. The total net income for the 3 year period is, 3 * 6500 = $19500

Plugging in the available values for the ending and beginning balance of retained earnings and net income, we can calculate the value of total dividends paid for the three year period.

15000 = 16000 + 19500 - Dividends

Dividends = 35500 - 15000

Dividends = $20500

4 0
3 years ago
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