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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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Whitepunk [10]

Answer:

They act out in movies

Explanation:

3 0
3 years ago
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John has finally gotten to the point where he can put away some money and start a rainy day fund. He wants to have access to his
zzz [600]

Answer:

Regular basic saving accounts

Explanation:

Rainy day fund is called a type of basic regular saving accounts. This account contains around 500 dollars to 1000 dollar It is like a payday loan. It is a type of liquid or we can say that it is like cash.

It is best in a bank account. such as saving account to pay the daily basis debts. Here people can access their money very quickly. When it is spent, you can again start to save for the future happening again.

4 0
3 years ago
The continuous falling price level is called inflation.<br> True or false?
Anton [14]

Answer:

True

Explanation:

When it start failling it is still true.

6 0
3 years ago
the document that states that the bank will pay a specified sum of money to a beneficiary, normally the exporter, on presentatio
yuradex [85]

The letter of credit is the financial document which tells that a bank will pay a specified sum of money to a beneficiary

Letter of credit is also called documentary credit or bankers commercial credit.

The financial document called "Letter of credit" is a a letter written by a financial institution which authorizing another institution to pay someone a sum of money.

This document is usually a mode of payment used for the importation of visible goods.

In conclusion, the document called "letter of credit" is the financial document which tells that a bank will pay a specified sum of money to a beneficiary

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3 0
2 years ago
Hampton Corporation has a beta of 1.3 and a marginal tax rate of 34%. The expected return on the market is 11% and the risk-free
vekshin1

Answer: 13.1%

Explanation:

Using the Capital Asset Pricing Model, the expected return is;

Expected Return = Risk Free rate + beta(expected return - risk free rate)

= 4% + 1.3( 11% - 4%)

= 4% + 9.1%

Expected Return = 13.1%

7 0
3 years ago
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