Which of the following is the correct way to describe equilibrium in a market?

Rabbit population can double every 30 days, if there are 26 rabbits on a farm, how many rabbits will be on the farm after 240 da

hichkok12 [17]

<span>With a period of 30 days, across 240 days there will be 240/30=8 separate periods where the population doubles. Therefore the population at the end of the time period will be the original, 26, times 2 raised to the 8th power, or 26*2^8 = 26*256=6656.</span>

3 0

3 years ago

Cox Footwear pays a constant annual dividend. Last year, the dividend yield was 3.2 percent when the stock was selling for $35a

marissa [1.9K]

Answer:

The current price of the stock is b. $38.62

Explanation:

Hi, in order to find the current price of the stock, first we need to find the amount paid as a constant dividend, the formula is as follows.

$DivYield=\frac{Dividend}{Price}$

So, things should look like this

$0.032=\frac{Dividend}{35}$

$Dividend=0.032*35=1.12$

So the amount of constant dividend tha this company is paying is $1.12/share

Now we can find the current price using the same equation and solving for "Price",

$0.029=\frac{1.12}{Price}$

$Price=\frac{1.12}{0.029} =38.62$

Therefore, the current price of the stock is $38.62, that would be option b.

Best of luck:

7 0

3 years ago

Holland Auto Parts is considering a merger with Workman Car Parts. Workman's market-determined beta is 0.9, and the firm current

Minchanka [31]

Answer:

0.097 OR 9.7%

Explanation:

Cost of Equity using CAPM-

Re = Rf + Beta (Rpm)

where,

Rf = Risk free return = 6%,

Rpm = Risk premium = 4%,

Beta = 0.9

Therefore,

Re = .06 + .9 (.04)

= 9.6%

Unlevered cost of equity:

ReU = Wd × rd + We × re

where,

ReU = Unlevered cost of equity,

Wd = Debt = 20%

rd = cost of debt = 8%

We = equity = 80%

re = cost of equity = 9.6%

Therefore,

ReU = 0.20 × 8% + .80 × 9.6%

= 9.28%

Levered cost of Equity:

New Debt = 60%,

New Equity = 40%,

New rd = 9%

ReL = ReU + (ReU - rd) (D ÷ E)

= 9.28% + (9.28% - 9%) (0.60 ÷ 0.40)

= 0.097 OR 9.7%

6 0

3 years ago

The accompanying graphs depict the market for bags of potato chips, which is currently at an equilibrium price of $1.67 per bag

Sergeeva-Olga [200]

Answer:

Equilibrium is the point of the interaction between the demand and supply curves.

The given graph given from the question is attached below (Image 1-2)

The solution is attached in image 3-4

6 0

3 years ago

Stock Repurchases Gamma Industries has net income of $3,800,000, and it has 1,490,000 shares of common stock outstanding. The co

Ad libitum [116K]

Answer:

stock price following the stock repurchase = $74.44

Explanation:

Stock Repurchases Gamma Industries has net income of $3,800,000, and it has 1,490,000 shares of common stock outstanding.

Formula for earnings per share:

Earnings per share = Net income/ number of shares outstanding

As Number of shares outstanding before repurchase = 1490000

Net Income = $3800000

Therefore by putting the values in the above formula, we get

Earnings per Share = $3,800,000/1,490,000

Earnings per Share = $2.5503

Formula for Price Earnings Ratio:

Price Earnings Ratio = Price / Earnings per share

Therefore by putting the values in the above formula, we get

Price Earnings Ratio = $67 / $2.5503

Price Earnings Ratio = $26.2710

As the company wants to repurchase 10% of its existing outstanding shares so

Number of shares repurchase = 1,490,000 × 0.10 = 149,000

The remaining number of outstanding shares are = 1,490,000 -149,000 = 1,341,000

Formula for Earnings per Share:

Earnings per Share = Net Income / number of shares outstanding

Therefore, its Earnings per Share after repurchase = $3,800,000 / 1,341,000 = $2.8337

As Price/ Earnings = 26.27 so the stock price following the stock repurchase = 26.2710 × 2.8337 = $74.44

4 0

4 years ago