Answer:
$6000
Explanation:
Break up of the economic cost of owning and operating the car for the year is mentioned below:
Car Bought - 10,000
Add: Insurance, license and operating cost - 1,500
Add: Interest (10,000 * 10%) - 1,000
Less: Car resold - (6,500)
Total - 6,000
Therefore, economic cost of owning and operating the car for the year was $6,000.
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Answer:
$2.48
Explanation:
This morining a stock was purchased.
The stock just paid an annual dividend of $3.10 per share
A return of 9.2% is required
= 9.2/100
= 0.092
The growth rate is 4%
= 4/100
= 0.04
The first step is to calculate today's price
= D1/(r-g)
=3.10× 1+0.04/0.092-0.04
= 3.10×1.04/0.092-0.04
= 3.224/0.052
= $62
The price at the end of year 3 can be calculated as follows
= today's price × (1+g)
= 62×(1+0.04)
= 62×1.04
= $64.48
Therefore, the capital gain can be calculated as follows
Price at the end of year 3-today's price
= $64.48-$62
= $2.48
Hence the capital gain is $2.48