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melomori [17]
3 years ago
9

Assume that at the end of the next year, Company A will pay a $2.00 dividend per share, an increase from the current dividend of

$1.50 per share. After that, the dividend is expected to increase at a constant rate of 5%. If an investor requires a 12% return on the stock, what is the value of the stock?
Business
1 answer:
Bezzdna [24]3 years ago
4 0

Answer:

The  value of the stock is $28.57

Explanation:

Data provided in the question:

Dividend paid at the end of the year, D1 = $2.00 per share

Increase in dividend = $1.50 per share

Growth rate, g = 5% = 0.05

Required rate of return = 12% = 0.12

Now,

Price with constant Dividend Growth model = D1 ÷ ( r - g )

= $2 ÷ ( 0.12 - 0.05 )

= $28.57

Hence,

The  value of the stock is $28.57

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national savings is equal to the sum of private savings and public savings. to make our notation a bit easier, we will call nati
slamgirl [31]

Here, public savings = $1.05 billion and private savings = $3.15 billion

It is calculated as follows:

Total savings, S = $4.20 billion

We know: S = V+U

It means National Savings = Private savings + Public savings

Here:

V = private savings , U = public savings and

Private saving, V = 0.75 × S

 = 0.75 × $4.20 billion

 = $3.15 billion

And, the public savings will be = National savings - private savings

= $4.20 billion - $3.15 billion

= $1.05 billion

To know more about savings here:

brainly.com/question/10749354

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3 0
2 years ago
The stock price of Atlantis Corp. is $43 today. The risk-free rate of return is 10%, and Atlantis Corp. pays no dividends. A cal
Elena-2011 [213]

Answer:

correct option is  a. $.05

Explanation:

given data

stock price S = $43

rate of return r= 10%

exercise price K = $40

time = 6 month

worth = $5

solution

we will apply here formula for worth that is  

P = C - S + K × e^{-rt}

here C is given worth 5 and S is stock price and K is exercise price and t is time and r is rate

so put here all value in equation 1 we get

P = C - S + K × e^{-rt}

P = 5 - 43 + 40 × e^{-0.1*6/12}

P = 5 - 43 + 38.05

P = 0.05

so here correct option is  a. $.05

8 0
3 years ago
At the beginning of 20x1, Sun Angel Corporation began offering a two-year warranty on its products. The warranty program was exp
Anettt [7]

Answer:

The correct answer is 1,900,000 dollars.

Explanation:

This question requires us to calculate the amount that the Sun angel will recognize as warrantly liability in it balance sheet for the year ended at 20x1.

The sales made during the year is 180 millions dollars. So the company will recognize the provision as follow (during the year)

(180M * 4%= 7.2M)

Debit Warrantly Expense    $7.2M

Credit Liability                      $7.2M

Claim entertain during the year that has reduce the above recognize liabilty is

Debit Liabilty                    $5.3M

Credit Cash                      $5.3M

Liability to be reported = $7.2M - $5.3M = 1,900,000 dollars

6 0
3 years ago
On Jan 5, a customer returned merchandise that had been purchased earlier on credit. The original sale was for $500, and the cos
Elodia [21]

Answer:

Debit Sales Returns and Allowances $500; debit Merchandise Inventory $150; credit Accounts Receivable $500; and credit Cost of Goods Sold $150.

Explanation:

Based on the information given the required appropiate journal entry to record the return on the books of the seller, in a situation were the goods can be sold to another customer is :

Debit Sales Returns and Allowances $500

Debit Merchandise Inventory $150

Credit Accounts Receivable $500

Credit Cost of Goods Sold $150

(To record the return on the books of the seller)

6 0
3 years ago
ROE is computed as: A. Net income attributable to controlling interest / Average equity attributable to controlling interest B.
Korvikt [17]

Answer:

The correct answer is E

Explanation:

ROE termed as or stand as Return on Equity, which is described as the  profitability ratio that evaluates the firm ability for generating the profits from its shareholders investment in the company or firm.

The formula to represent ROE is value of Net Income attributable to the equity shareholders.

ROE = Net Income agter Taxes / Shareholders Equity

And there is one more formula which is a disaggregation of ROE into the non- operating as well as operating components, which is as:

ROE = [ROE +(FLEV × Spread)] x NCI

Therefore, option A and C are correct.

6 0
3 years ago
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