Answer:
d. preemptive right
Explanation:
Preemptive rights refers to the clause that is included in a merger agreement or security that allows an investor to buy a proportionate number of shares to be issued in the future in order to protects him from losing his percentage ownership of a company.
The aim a preemptive right is to avoid a situation whereby the management of the company take over the control of the company by issuing and buying extra shares of the corporation to themselves. It basically aims to prevent the dilution of the value of stockholders.
Answer:
Corporate social responsibility
Explanation:
Corporate social responsibility (CSR) is an approach that a business uses to demonstrate its concern for the surroundings. Through CSR, a company exhibits its commitments to the public or the environment. By practicing CSR, companies become corporate citizens.
CSR is gaining popularity. Businesses are adopting sustainable development agenda into their business models. Engaging in conservation matters makes Clendtine Fashions a friend to the environment.
Answer:
FITCH
PAYBACK PERIOD = Iniatial outlay / Annual cash flow
Annual cash flow = Cash revenue - Cash expenses
= $6,110 - $860 = $5,250
Payback period = $8,040/ $5,250 = 1.53years
Incremental Net Income = Cash revenue - Cash expenses - Depreciation
= $6,110 - $860- ($8,040/3)
= $6,110 - $860 - $2,680
= $2,570
Unadjusted Rate of Return = Average Profit/initial invesment
= $2,570/$8,040
= 31.97%
Explanation:
Answer:
Answers below
Explanation:
According to constant Dividend Growth Model, Dividend is expected to grow at a constant rate.
Expected Earnings next yeae = E1 = $8
ROE of the firm = 15%
Plowback Ratio= 60%
Dividend Payout Rato = 1 - Plowback Ratio = 1-60% = 40%
Thus, Expected Dividend next year = D1 = 0.4 * 8 = $3.2
Growth of the Firm = g = ROE * Plowback Ratio = 15% * 60% = 9%
Market Capitalisation Rate = k = 10%
a) Price of the share using constant dividend growth model = D1/ (k - g) = 3.2 / (10% - 9%) = 3.2 / 0.01 = $320
b) Price with no growth will be the price where company pays out all the earnings as dividend and does not retain or plowbacka anything thus making growth = 0%
Thus, price with no growth = E1 / k = 8 / 0.1 = $80
c) Price of the share using constant dividend growth model = Price with no growth + Present Value of Growth Opportunities (PVGO)
Hence, 320 = 80 + PVGO
PVGO = 320 - 80 = $240
Thus, Present Value of Growth Opportunities = $240