Answer:
The fair price of stock today is $48.425 and that is the most one should be willing to pay today.
Explanation:
The company's dividend will grow at a constant rate of 4.3% which means that the constant growth model of Dividend Discount Model will be used to calculate the price of a stock today.
The formula for Constant growth model is,
P0 = D0 (1 + g) / r - g
Where,
- D0 is dividend today
- r is the required rate of return
- g is the growth rate in dividend
P0 = 1.95 * (1+0.043) / 0.085 - 0.043
P0 = $48.425
Answer:
a special type of stock that is not transferable from the current holder to others until specific conditions are satisfied
Explanation:
The restricted stock is the stock or the securities that are restricted means that they are not fully transferable when the specific conditions is not fulfilled. When these conditions would be fulfilled so these stock would not be considered as a restricted and they are freely transferable
Therefore the first option is correct
Decrease the total assets and increase the total expenses.
Answer:
If increasing the level of capital from $8 million to $12 million increases real GDP from $4 to $6 million, then a further increase of the level of capital from $12 to $16 million should increase the real GDP but not in the same proportion, i.e. it will not increase the real GDP from $6 million to $8 million.
An increase in the level of capital will increase investment in the economy, but unless productivity or technological progress increases, then the gains will tend to be smaller every time.
Investment is the greatest driver of economic growth, but it cannot do it all by itself. Productivity must increase, and generally when investment increases, productivity increases due to technological progress. E.g. You deliver packages on a bicycle and are able to deliver 10 packages per day. If the company gives you a delivery truck (increase in investment and technology) then you will be able to deliver 30 packages per day and your productivity will have increased by 200%.
