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
Alina [70]
3 years ago
9

Fire Hydrant Pet Supply just paid its first annual dividend of $0.75 a share. The firm plans to increase the dividend by 2.9 per

cent per year indefinitely. What is the firm's cost of equity if the current stock price is $16.90 per share
Business
1 answer:
AleksandrR [38]3 years ago
8 0

Answer:

Cost of equity =  7.47%

Explanation:

<em>The Discounted Cash flow (DCF) Model; This is a technique used to value the worth of an asset. According to this model, the value of an asset is the sum of the present values of the future cash flows that would arise from the asset discounted at the required rate of return. </em>

Using this model,  the required rate of return is the cost of equity. It is given below as follows:

Cost of equity (Ke) =( D(1+g)/P) + g

Div in year 0, P= ex-div market price, g= growth rate in div.

D- 0.75 , g- 2.9%, P-16.90

For this question,

Ke= ( 0.75×(1+0.029)/16.90 ) + 0.029

=0.0746 × 100  

= 7.47%

Cost of equity =  7.47%

You might be interested in
In most industries, getting into which kind of role usually requires experience? A. Entry-level B. Intership C. Managerial
dusya [7]
The answer is B. Because that is what helps you the most:)
3 0
3 years ago
Read 2 more answers
Relatively unknown events are best marketed through
nydimaria [60]

Personalized marketing

5 0
3 years ago
Accounting information systems:
Dafna1 [17]

Answer:

The correct answer is letter "D": are an information system that records, processes, and reports on transactions to provide financial and non-financial information for decision making and control.

Explanation:

An Accounting Information System or AIS is a way to track all of a company's accounting activities. An AIS provides easy access to the same information to different departments. An AIS collects, stores, retrieves and processes the data. The data can come from internal and external sources allowing managers to make decisions about the business operations.

3 0
2 years ago
Which of the following would likely be covered under homeowners insurance but NOT by renter's insurance?a. Your basement floods,
VladimirAG [237]

Answer:

C

Explanation:

The answer is a tree branch breaks your bedroom window during a storm because this is covered by the homeowners insurance and not by the renters insurance

Renter’s insurance does not cover building or Structure on sites

7 0
3 years ago
A new faculty member at the local university pays $1,500 per month to rent an apartment in the downtown area. She teaches on cam
Naddik [55]

Answer:

$2,700

Explanation:

Calculation for what should this professor be willing to pay in rent per month

First step is to calculate the Transportation cost per week

Transportation cost = ($25*4 hrs)* 3 per week

Transportation cost =$100*3 per week

Transportation cost= 300 a week

Now let calculate the rent per month

Rent per month= $1500 + ($300*4)

Rent per month=$1,500+$1,200

Rent per month= $2,700

Therefore what should this professor be willing to pay in rent per month to live near campus if her hourly wage rate is $25 will be $2,700

3 0
2 years ago
Other questions:
  • Cullumber Company had a 40 percent tax rate. Given the following pre-tax amounts, what would be the income tax expense reported
    11·1 answer
  • Suppose you are a T-shirt producer in a market without price controls. You are charging a price that is below the equilibrium pr
    8·2 answers
  • On August 5, 2021, Sandhill Furniture shipped 50 dining sets on consignment to Furniture Outlet, Inc. The cost of each dining se
    6·1 answer
  • Lexie, a marketing manager, regularly interviews candidates for her team. Because Lexie is a people person and her department is
    8·1 answer
  • #. When you gave your friend a fifty-dollar bill for an iPod, you used money as.....A. a standard /B. store of value/ C. medium
    12·2 answers
  • Ajak Corporation owns​ 85% of the single class of Utech Corporation stock. Utech Corporation owns​ 35% of Tech Corporation. Ajak
    5·1 answer
  • In the case of such a catastrophe like the one we are facing (corona
    14·1 answer
  • Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the
    14·1 answer
  • A firm that shuts down temporarily has to pay a. its fixed costs but not its variable costs. b. its variable costs but not its f
    5·1 answer
  • The recurrent ups and downs in the level of economic activity extending over several years are referred to as?
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!