1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
mariarad [96]
4 years ago
10

Analysts are forecasting LifeTech Corporation's common stock price to be $120 at the end of one year. Also, LifeTech will pay a

dividend of $2.60 one year from now. You plan to buy the stock now and sell at the end of one year. If you require a 13% return, what would you be willing to pay to buy the stock now
Business
1 answer:
devlian [24]4 years ago
5 0

Answer:

Price to pay now for the stock = $96.278

Explanation:

<em>The price of the stock would be the present value(PV) of the future cash flow expected from it discounted at the required rate of 13%</em>

<em>Hence we would add the present value of he dividend and the resent of he price at the end of the period</em>

PV = CF × (1+r)^(-n)

<em>CF- Cash Flow</em>

<em>R- rate of return- 13%</em>

<em>n- number of years</em>

PV of dividend =  2.60 × (1.13)^(-1) =  2.30

PV of stock price after a year = 120× (1.13)^(-1) = 93.97

Price to pay now for the stock =  2.30 + 93.97 = $96.278

Price to pay now for the stock = $96.278

You might be interested in
Dean's Coffee Shop makes a blend that is a mixture of two types of coffee. Type A coffee costs Deon $4.75 per pound, and type B
sergiy2304 [10]

Answer:

type B 50 pounds

type A 94 pounds

Explanation:

First we construct the equation system:

\left \{ {{A_q + B_q = 144} \atop {4.75A_q + 5.9B_q = 741.5}} \right. \\

Now we clear one and replace:

A_q = 144 - B_q\\4.75A_q + 5.9B_q = 741.5\\4.75(144 - B_q) + 5.9B_q = 741.5

And we can solve for type B:

4.75\times 144 - 4.75B_q + 5.9B_q = 741.5\\1.15B_q = 741.5 - 684\\B_q = 57.5 / 1.15 = 50

And now we can solve for quantity of A as well:

A = 144 - 50 = 94

<u>Finally we can check the answer if it is correct:</u>

50 x 5.9 + 94 X 4.75 =

   295       +      446,5‬   = 741,5‬

5 0
4 years ago
An ad for Maybelline age-minimizing makeup in Ladies' Home Journal magazine featured actress Gigi Hadid and offered readers a $2
marysya [2.9K]

Answer:

Home Journal magazine

Explanation:

In communication, medium is what the message is conveyed on. It is the system or channel through which a message is transmitted from the sender to the recipient. The modern medium used in advertising is in the electronic format and includes the internet, telephone, and other electronic devices.

Tradition medium channels are television, radio, and print media such as newspapers and magazines.  The ad for Maybelline age-minimizing appears in a magazine. The  Ladies' Home Journal magazine is the medium for the ad.

6 0
4 years ago
Read 2 more answers
Suppose Simon and Carla are the only buyers of music downloads. How would you create a market
Alekssandra [29.7K]

The market demand curve is used to show the summation of the individual demand curves that are in a given market.

This is an incomplete question and I'll explain the <em>demand curve</em> and give you an idea on how to answer the question.

The market demand curve is used to show the summation of the individual demand curves that are in a market. The<em> market demand curve</em> shows the quantity demanded of the products at various prices.

In order to draw the graph, the <em>price </em>will be on the vertical axis, the <em>quantity demanded </em>will be on the horizontal axis.

It should also be noted that a shift to the right of the <em>demand curve</em> implies that there's an increase in the <em>demand </em>for a product while a shift to the left implies that there's a reduction in the demand for a product.

Read related link on:

brainly.com/question/24978137

8 0
3 years ago
The following data pertains to activity and the cost of maintenance for two recent months: Month 1 Month 2 Production Volume 200
Flauer [41]

Answer:

Fixed cost= $100

Explanation:

The high low method considers the level of highest activity and lowest activity, and compares cost at each of these levels.

It is a useful way of calculating variable cost and fixed cost.

The variable cost= (High activity cost - Low activity cost)/ (High activity units- Low activity units)

Variable cost= (1,100-900)/ (2,500-2,000)

Variable cost = 200/500= $0.4

Fixed cost= High activity cost- (variable cost* High activity units)

Fixed cost= 1,100- (0.4* 2,500)

Fixed cost= 1,100- 1,000

Fixed cost= $100

5 0
3 years ago
Empire Electric Company (EEC) uses only debt and common equity. It can borrow unlimited amounts at an interest rate of rd = 11%
weeeeeb [17]

Answer:

11.66

7.6475

project A

Explanation:

5 0
3 years ago
Other questions:
  • Heidi owns 400 shares of Boyd Enterprises stock, which is valued at $17 a share. Boyd Enterprises just declared a 10 percent sto
    9·1 answer
  • If the inflation rate was 3.00% and the nominal interest rate was 8.00% over the last year, what was the real rate of interest o
    7·1 answer
  • Which of the following things are taken into consideration when using the aggregate demand-aggregate supply (AD-AS) model to ill
    5·1 answer
  • Marta has a tight marketing budget and needs to use a strategy that can drive customers to her website for a set cost. Which bid
    9·1 answer
  • The 2019 balance sheet of Dyrdek’s Skate Shop, Inc., showed $530,000 in the common stock account and $2.3 million in the additio
    10·1 answer
  • Please help me i reallu need your help
    6·2 answers
  • The majority of problems Best Buy was facing have been brought about by _________________force.
    9·1 answer
  • Examples of productivity in economics.
    14·1 answer
  • 4. What are the main political and economic risks that ABB must deal with given that it has a strong focus on entering emerging
    14·1 answer
  • 2. List several groups that will increase as a percentage of the total U.S. workforce in the next decade.​
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!