Answer:
None of the options are correct as the price today will be $26.786
Explanation:
The price of a stock whose dividends are expected to grow at a constant rate forever can be calculated using the constant growth model of the dividend discount model approach (DDM). The DDM bases the value of a stock on the present value of the future expected dividends from the stock.
The formula for price under constant growth model is,
P0 = D1 / (r - g)
Where,
- D1 is the dividend expected for the next period
- r is the required rate of return or cost of equity
- g is the growth rate in dividends
However, as the constant growth rate in dividends is to be applied from Year 2 onwards, we will use the D2 to calculate the price at Year 1 and we will then discount this further for one year to calculate the price today.
P1 or Year1 price = 2 * (1+0.05) / (0.12 - 0.05)
P1 or Year 1 price = $30
The price of the stock today or P0 will be,
P0 = 30 / (1+0.12)
P0 = $26.786
Hoover raised the prices of wheat and grains during World War 1 in order to incentivize farmers to produce more for the market.
For a merchandising company, the cost of goods sold, direct materials, and commissions are <u>variable costs</u>.
<h3>What is a variable cost?</h3>
A variable cost is the cost element that remains constant per unit while the total changes. Other examples of variable costs include direct labor, variable selling and administrative expenses, including commissions and shipping costs.
Thus, for a merchandising company, the cost of goods sold, direct materials, and commissions are all examples of <u>variable costs</u>.
Learn more about variable costs here: brainly.com/question/5965421
Answer:
A bond is a fixed income instrument that represents a loan made by an investor to a borrower bond could be thought of as an I.O.U. between the lender and borrower that includes the details of the loan and its payments.
Explanation:
Answer:
"The rigidity of rules and regulations
" is the appropriate response.
Explanation:
- Rigidity seems to be a distinguishing characteristic of the disposition among people with autism or disabilities.
- The same kind of perspective also requires an individual to implement strict guidelines to circumstances that require uncertainty as well as consistency.
That being said, regulations, as well as standards, seldom operate stringently, with little difference throughout circumstances and conditions.
