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Fittoniya [83]
3 years ago
7

Gamma Corp. is expected to pay the following dividends over the next four years: $5, $12, $18, and $1.80. Afterward, the company

pledges to maintain a constant 4 percent growth rate in dividends, forever. If the required return on the stock is 14 percent, what is the current share price?
Business
1 answer:
Vikentia [17]3 years ago
5 0

Answer:

The current share price is  $37.49(appx)

Explanation:

Consider the following calculations

current share price

= 5/(1+0.14) +12/(1+0.14)^2 + 18/(1+0.14)^3+1.8/(1.0.14)^4+1.8/(0.14-0.04)*(1+0.14)^4

=4.386+9.233+12.15+1.065+10.657

=$37.49 (appx)

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True or False. Expense for a quality-assurance warranty is recorded along with the related liability in the reporting period in
Novosadov [1.4K]

Answer:

True

Explanation:

Whenever a company sells products that may generate warranty expenses, it must estimate the warranty expenses associated with the products sold.

It must credit a warrant liability account, and as the warrant claims are made, the company must debit a warranty expense account.

5 0
3 years ago
A recent survey was conducted to compare the cost of solar energy to the cost of gas or electric energy. Results of the survey r
RoseWind [281]

Answer:

option d) approximately 84%

Explanation:

Data provided in the question:

Mean, m = $92

Standard deviation, s = $13

Now,

we have to calculate percentage of homes will have a monthly utility bill of more than $79 i.e P(X > 79)

also,

P( X > 79) = 1 - P( X < 79)

Z-score for (X = 79 ) = \frac{X-m}{s}

Z = \frac{79-92}{13}

or

Z = -1

From the standard Z value vs P table, we have

P( Z < -1 ) = 0.1587

Thus,

P( X < 79) = P( Z < -1 ) = 0.1587

therefore,

P(X > 79) = 1 - 0.1587

or

P(X > 79) = 0.8413

or

= 0.8413 × 100%

= 84.13%

Hence,

option d) approximately 84%

7 0
3 years ago
Each of the following factors affects the weighted average cost of capital (WACC) equation. Which are factors that a firm cannot
QveST [7]

Answer:

-Tax rates

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Explanation:

The factors that a firm cannot control are the ones that it has no power to decide and they are determined by a third party. According to that, from the options given, the factors that the firm cannot control are tax rates because they are established by the government and the general level of stock prices because it is determined by the supply and demand in the market.

The other options are not right because the company  can establish its process to evaluate investments and expenses and how to finance its assets with debt and equity.

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4 years ago
Which one of the following items would you be most likely to keep in a database ?
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7 0
3 years ago
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The form of promotion that would work for technical products like automobiles is b. Informative promotion.

<h3>What is informative promotion?</h3>

This is where features of the good being advertised are elaborated on to ensure the viewer understands the product's functionality.

This is useful for technical products like computers and cars as there is a need for customers to know what makes them better.

Options for this question include:

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6 0
2 years ago
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