Answer:
Value per share today is $13.28
Explanation:
The sustainable growth rate can be calculated using the following formula,
Sustainable growth rate (g) = ROE * (1 - DividendPayout Ratio)
Where,
- ROE is the return on equity
- (1- dividend payout ratio) also known as retention ratio
Thus, g = 0.07 * (1-0.6) = 0.028 or 2.8%
The formula for price or intrinsic value per share is,
P0 or V = D1 / r-g
The earnings per share is Net income per share. Out of this net income, 60% will be paid out as dividends so dividend per share expected for next year is 2.7 * 0.6 = 1.62
Thus, value per share will be,
V = 1.62 / (0.15 - 0.028) = $13.278 rounded off to 13.28
Answer:
price = $47.82
Explanation:
Find the present value of each dividend at the required rate of return and sum them up to get the current price;
PV = FV /(1+r)^n
PV(D1) = 3.55/ (1.099^1) = 3.2302
PV(D2) = 4.65/ (1.099^2) = 3.8500
PV(D3) = 5.85 / (1.099^3) = 4.4072
PV(Price at t=4) = 53 / (1.099^4) = 36.3316
Price = 3.2302+2.9392+4.4072+36.3316
= 47.81897
Therefore, price = $47.82
Answer:
e. price elasticities of demand for apples and oranges are the same over these price ranges
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price.
Price elasticity = percentage change in quantity demanded / percentage change in price
Percentage change in price = (50-40) / 50 = 0.2 × 100 = 20%
Percentage change in quantity demanded of Apples = (120 - 100) / 100 = 0.2 × 100 =
20%
Percentage change in quantity demanded of oranges = (240 - 200) / 200 = 0.2 × 100 = 20%
Price elasticity of demand for oranges = 20% / 20% = 1
Price elasticity of demand for Apples = 20% / 20% = 1
When coefficient of elasticity is equal than one, elasticity of demand is unit elastic.
This implies that the elasticity of demand for Apples and oranges are the same. A change in the price of oranges and apples would lead to the same proportional change for each of the demand for Apples and oranges.
I hope my answer helps you
Answer:
recruitment policy
Explanation:
A recruitment policy is a statement on how you hire. It outlines your company's preferred hiring practices and promotes consistency within your employee recruiting process
