Answer:
The holding period return is 8%
Explanation:
In this question we need to find the holding period return for the stock, and for that we would need to know what is the stocks current price, what would the stocks price be in one year and how much dividend it will pay during the year. Their last dividend paid was $4 and their dividend is expected to grow at 5% in the future so the dividend paid in the current year would be 4*1.05= 4.2.
To find the current price of the stock we will use the DDM formula
DDM= D*(1+G)/R-G
(4*1.05)/(0.08-0.05)
Price = 140
Now we need to know what the stocks price would be in one year. For that we need to know the previous dividend which is 4.20, the growth rate which is 5% and the required rate of return which is 8%
DDM= (D*(1+G)/R-G
4.2*1.05/0.08-0.05
Price = 147
So now we know the current price, current year dividend and year end price we can calculate the holding period return.
Holding period return = (Dividend +(End of period price-Initial Price))/Initial Price
Dividend = 4.20
End Period Price = 147
Initial Price = 140
Holding period return = 4.20+(147-140)/140
=11.20/140
=0.08
=8%
Answer:
Price Skimming
Explanation:
Price skimming is a pricing strategy approach where the producer sets the high price due to this it could attract purchased for having the strong desire with related to the product and then it normally decreased the prices to attract another one and so on
So as per the given situation, it is a prime skimming situation
Answer:
The correct answer is (3)
Explanation:
A Limited Liability Company, or LLC, is a kind of legitimate business structure that makes a body separate from the entrepreneur. The essential advantage in framing a LLC in your venture is that you, and any partner from your business, are protected from individual obligation. That implies if your business is sued, offended parties can just pursue your business resources and not your own ones, for example, your home.
D, that would most likely be a common answer because why would costumer service be provided by a company instead of the sales rep?
