Answer:
Assume that the Plow back Ratio is 50
Now,
To Compute the growth rate;
Growth rate = Return on equity × Plow back ratio
Growth rate = 10% × 0.50
Growth rate = 5.0%
Computation of the stock price.
Stock price = Dividend pa share / (Required rate - Growth rate)
Stock price = Earnings pa share × (1 - Plow back ratio) / (Required rate -Growth rate)
Stock price = $4 × (1 - 0.50) / (10% - 5.00%)
Stock price = $2.00 / 5.00%
Stock price = $40
Computation of the P/E ratio.
PIE ratio = Stock price / Earnings pa share
PIE ratio = $40 / $4
PIE ratio = $10
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Answer: 14.59%
Explanation:
The Internal Rate of Return(IRR) is the discount rate that brings the Net Present Value to zero. It is used to decide the viability of projects. The project is generally considered viable if the Cost of capital is less than the IRR.
You can use Excel to calculate the IRR;
= IRR(-15,800,6,500,7,800,6,300)
From the picture attached you can see that the IRR is 14.59%
Answer:
Option B
Explanation:
In simple words, The fundamental mistake throughout the attribution refers to the propensity for individuals to overemphasise personal attributes and neglect environmental variables in evaluating actions of others.
For instance, in one experiment whenever something unpleasant occurred to somebody else, participants blamed the actions or attitude of that individual 65 per cent of the total times. Thus, from the above we can conclude that the correct option is B.
Answer:
C. Nicholas is not required to recognize gross income, but must reduce his cost basis in the land to $130,000
Explanation:
