1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
OverLord2011 [107]
4 years ago
11

The Jameson Company just paid a dividend of $0.75 per share, and that dividend is expected to grow at a constant rate of 5.50% p

er year in the future. The company's beta is 1.15, the market risk premium is 5.00%, and the risk-free rate is 4.00%. What is Jameson's current stock price, P0?
Business
1 answer:
belka [17]4 years ago
5 0

Answer:

Jameson's current stock price, P0 is  $18.62

Explanation:

Required rate of return = Risk free rate + Beta*Market risk premium.

                                       = 4.00% + 1.15*5.00 %

                                       = 9.75 %

Current stock price, P0

= Expected dividend per share/(Required rate of return - Growth in dividends)

= (0.75 + 5.50%*0.75)/(0.0975 - 0.055)

= $18.62

Therefore, Jameson's current stock price, P0 is  $18.62

You might be interested in
How much money does a therapyst make an hour/ and how much would they make in a year
enot [183]
An hour = the average hourly pay for a Therapist in the United States is $28.33 an hour. While ZipRecruiter is seeing hourly wages as high as $52.40 and as low as $12.74, the majority of Therapist wages currently range between $20.91 (25th percentile) to $31.01 (75th percentile) across the United States.

a year = the median annual salary for clinical, counseling, and school psychologists was $85,340 per year, according to the Bureau of Labor Statistics. The lowest 10 percent of workers earned less than $44,040, and the highest 10 percent earned more than $129,310.
3 0
3 years ago
Read 2 more answers
Suppose the Herfindahl indexes for industries A, B, and C are 1,200, 5,000, and 7,500 respectively. These data imply that: Group
iVinArrow [24]

Answer: market power is greatest in industry C.

Explanation:

The Herfindahl–Hirschman Index, is the measure of market concentration. It is calculated by squaring the market share of every firm that is competing in the market after which the resulting numbers will be added.

A market that has an HHI of less than 1,500 is said to be a competitive marketplace. A market that has an HHI of 1,500 to 2,500 is said to be moderately concentrated while a market that has an HHI of 2,500 or more is said to be highly concentrated. Therefore, the industry with the highest Herfindahl indexes here is industry C with 5000 and it has the most market power.

3 0
3 years ago
The payments a business makes for investing in capital expenses are known as : A) profits
blsea [12.9K]
The answer for this question is A.
7 0
4 years ago
Read 2 more answers
Judith puts $5000 into an investment account with interest compounded continuously. which approximate annual rate is needed for
Oxana [17]
In the question, continuously should be annually.

Solution:
Applicable formula is;
A = P(1+r)^n

Where;
A = Total amount after 30 years = $9,110
P = Amount invested = $5,000
r = Annual interest rate in decimals
n = Number of years = 30

Substituting;
9110 = 5000(1+r)^30
9110/5000 = (1+r)^30
1.822 = (1+r)^30
Taking natural logs on both sides;
ln (1.822) = 30 ln (1+r)
0.5999 = 30 ln (1+r)
0.5999/30 = ln (1+r)
0.019998 = ln (1+r)
Taking exponents on both sides
e^0.019998 = 1+r
1.0202 = 1+r
r = 1.0202 -1 = 0.0202 =2.02%

Therefore, annual interest rate should be 2.02%.
3 0
3 years ago
Managerial accounting information for a company
Bad White [126]

Answer:

Correct answer is b. relates to subunits ot the entity and may be very detailed.

Explanation

Managerial accounting involves collecting, storing, analyzing, and reporting information about the operations, activities and finances of a business. These reports are generally used by the managers of a business, rather than by any external entities, such as shareholders or lenders. The purpose of this accounting is to facilitate manager from senior to line level to make informed decision.

So in order to run the business smoothly this information/accounting is required  to be very detail and covering each and every aspect of the entity.

5 0
4 years ago
Other questions:
  • Bauman Flooring found a supplier of very inexpensive fibers that could be used to produce low-grade carpeting at a very low cost
    7·1 answer
  • All of the following course requirements must be completed to earn a bachelor's degree at most four-year colleges except
    12·2 answers
  • if we sell pizzas for $11.99 and our business' variable costs are 60% of the selling price, and we have fixed costs of $21,000 e
    9·1 answer
  • The law of demand is the assertion that ... ?
    5·1 answer
  • Ted owns a small florist shop. Since his business is booming, his realizes he will soon need one more delivery van. He decides h
    6·1 answer
  • . Understanding how shirking decreases team output Caroline sells bottled water from a small stand by the beach. On the last day
    10·1 answer
  • (3) Why is the medical arms race less a problem today than it once was?
    9·1 answer
  • Suppose a REIT pays out a dividend today of $3.00 and the projected dividend growth rate is 2%. The investor has a required rate
    12·1 answer
  • Despite Alisa’s request for a 7% wage increase for workers with seniority, Katherine flat out rejects the request and cites the
    14·1 answer
  • In a command economy, which group is most responsible for producing the
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!