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Sholpan [36]
3 years ago
8

Valley Farms offers to sell Whole Harvest Bakeries, Inc., five hundred bushels of wheat. Whole Harvest responds, "We agree to bu

y five hundred bushels only if the wheat is Grade A quality." This statement is
Business
1 answer:
Yuki888 [10]3 years ago
7 0

Answer: a counteroffer

Explanation:

From the question, we are informed that Valley Farms offers to sell Whole Harvest Bakeries, Inc., five hundred bushels of wheat and that Whole Harvest responds by saying "We agree to buy five hundred bushels only if the wheat is Grade A quality."

The above statement is s counteroffer. A counteroffer is a response that is given based on an initial offer and it happens mostly when the initial offer is not accepted and therefore it is replaced with another offer.

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Answer and Explanation:

The formula to compute the required rate of return using the CAPM and constant growth model is as follows

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The Required rate of return = Risk-free rate of return + Beta × (Market rate of return - risk-free rate of return)

Constant growth model = Dividend ÷ Price + Growth rate

For Estee lauder,

Under CAPM = 4% + 0.74 × (10% - 4%)

= 4% + 0.74 × 6%

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Under the Constant growth model

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For Kimco realty,

Under CAPM = 4% + 1.51 × (10% - 4%)

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Under the Constant growth model

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= 10.12%

Under the Constant growth model

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