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Rudiy27
2 years ago
13

ConsGrough, Inc. has increased its annual common dividend by 3% in each of the years that the company has existed. If you believ

e that the company can continue to do so indefinitely, then what price would you be will to pay for ConsGrough if the required rate of return is 6% and the dividend that it paid yesterday was $5?
Business
1 answer:
Salsk061 [2.6K]2 years ago
8 0

Answer: $171.67 would be the price of the security

Explanation: This problem relates to dividend growth model, which can be shown as follows :-

=\frac{D_{1}}{P_{0}}+\:G

where'

d1 = expected dividend

p = price

g = growth rate

therefore,

=\frac{\$5\left ( 1+3\% \right )}{P_{0}}+\:3\%

solving this we get

p_0=\$171.67

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Answer:

more intense the competitive pressures posed by substitute products.

Explanation:

The lower the user's switching costs: the more intense the competitive pressures posed by substitute products.

Switching costs can be defined as the cost of a consumer switching from a product to a substitute good.

Therefore when such switching costs are low, it will be easier to switch from one product to another, implying that the competitive pressure from substitute goods are higher.

8 0
2 years ago
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Automakers began rewarding dealers with financial incentives long before dealership customers started getting them, too. Recipie
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Answer:

Spiff

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In the given case, Automaker is paying spiff to dealers to encourage sales of it´s own brand over a competitor's product sold at the same store.

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3 years ago
Alex is starting a career in ux and wants to be able to specialize in a particular ux design role and focus on one project from
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A small start-up is a good fit for Alex.

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Despite their tiny size, startups can have a big impact on the expansion of the economy. Startups are the epicenters of the invention; they generate jobs, which increases employment and boosts the economy; and they have a noticeable influence on the cities in which they settle.

After a few years of operation, startups are on the road to success. While small firms develop quickly, they can only do so if they start to see success over time. A startup needs time to develop and gain a large customer base that can use its product.

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8 0
1 year ago
Global industries (GI) is planning to use some existing equipment from its own facilities in a foreign project. The used equipme
coldgirl [10]

Answer

The answer and procedures of the exercise are attached in the following archives.

Step-by-step explanation:

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

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2 years ago
The stock of Mulberry Corporation is owned by Archana (60%) and Anar (40%), who are mother and daughter. Pursuant to a plan of c
Phoenix [80]

Answer:

There is loss of $109,120

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Lossrecognized=Marketvalue−Purchasevalue

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​

4 0
3 years ago
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