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mrs_skeptik [129]
3 years ago
12

paid an annual dividend of $1.47 a share last month. The company is planning on paying $1.55, $1.63, and $1.65 a share over the

next three years, respectively. After that, the dividend will be constant at $1.70 per share per year. What is the market price of this stock if the market rate of return is 11 percent
Business
2 answers:
larisa [96]3 years ago
8 0

Answer:

The market price for this stock is $15.23

Explanation:

The price per share of a stock today can be calculated using the dividend discount model which values a stock based on the present value of the expected future dividends of the stock. The value of this stock using the DDM will be,

V0 or P0 =  1.55 / (1+0.11)  +  1.63 / (1+0.11)^2  +  1.65 / (1+0.11)^3  +  

[ ( 1.7 / 0.11) / (1+0.11)^3 ]

V0 or P0 = $15.226 rounded off to $15.23

Ivan3 years ago
8 0

Answer:

Market price= $15.226

Explanation:

<em>The Dividend Valuation Model is a technique used to value the worth of an asset. According to this model, the worth of an asset is the sum of the present values of its future cash flows discounted at the required rate of return.</em>

Year

1    $1.55, × (1.11)^(-) = 1.396396396

2    $1.63 ×  1.11^(-2) =  1.322944566

3     $1.65 ×  1.11^(-3)= 1.206465779

4 and beyond

This will be done in two stages below

PV of dividend in year 3

1.70/0.11 = 15.45454545

PV of dividend in year 0

15.45 × 1.11^(-3) = 11.3002

Market price of share

=1.39+ 1.322+ 1.206 + 11.300

= 15.226

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The 2,000 employees working in Toyota's factory in France are an example of the ______ effect of FDI on employment, while the 2,
melisa1 [442]

Answer:

Direct;indirect.

Explanation:FDI(FOREIGN DIRECT INVESTMENT) This is a term used in an economy to describe the investments done in a given country by foreigners or foreign companies in this case the foreigners or their companies have control over the entity formed in that host nation,it is usually evaluated periodically to know what the value of such an investment is. Through Foreign direct investment direct jobs ( jobs directly connected to the new company like it's workforce) and indirect jobs( jobs not directly linked with the new company like those who make supply spares etc).

8 0
3 years ago
Oscar owns a building that is destroyed in a hurricane. His adjusted basis in the building before the hurricane is $130,000. His
damaskus [11]

Answer:

That is $2,000 loss

Explanation:

After the hurricane Oscar received $140,000 for his loss, the adjusted basis for his property was $130,000 so he had a gain of 140,000- 130,000=$10,000.

According to Sec. 1033(a)(2) since the new property that was built (the replacement) was similar we will recognise the amount received from the insurance company ($140,000) to the extent that it pays for the replacement property.

That is

Gain or loss = amount paid by insurance company- cost of replacement property

Gain or loss= 140,000- 142,000

Gain or loss= -$2,000

That is $2,000 loss

8 0
3 years ago
All of the following bank reconciliation items would result in an adjusting entry on the company's books excepta. interest earne
Olin [163]

Answer:

b. deposits in transit

Explanation:

Bank Reconciliation: The bank reconciliation deals with the bank statement balance and the cash statement balance. The motive is to compare these two statements so that the organization can run in the smooth manner.  

There are various transactions due to which the bank statement balance and the cash statement balance do not match. To match these statements, we adjust the transactions accordingly.

The adjusting entry of interest earned is

Cash A/c Dr

     To Interest income A/c

(Being interest is earned)

Likewise, for The fee for collection

Bank charges A/c

     To Cash A/c

(Being fees is charged)

And for NSF check of customer, it would be

Account receivable A/c Dr

          To Cash A/c

(Being the adjusting entry is made)

So, for this the adjusting entry is made but for Deposit in transit , no adjusting entry would be made.

6 0
3 years ago
Which of the following statements is true about work hour regulations for 14 and 15-year-olds?
Katena32 [7]

Answer: they can work up to 3 hours during school day

Explanation:

5 0
3 years ago
Validated changes and validated deliverables are the outputs of the _____ sub-process of project quality management.
bija089 [108]

Validated changes and validated deliverables are the outputs of the monitoring and controlling sub-process of project quality management.

Project quality management is the process in which the quality of all activities is measured continuously  and taking the  corrective action until the desired quality is achieved.

Quality management processes help  the organization to control the cost of a project, after controlling the cost of project standards are established  and  the steps in achieving and confirming those standards are determined.

Effective quality management of a project must lowers the risk of product failure or unsatisfied and unhappy clients.

Project quality management occurs with these three processes:

Quality planning

Quality assurance

Quality control

To learn more about project quality management here:

brainly.com/question/15088255

#SPJ4

8 0
1 year ago
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