The ability to forecast cause and effect is crucial for a solid economic model since it enables it to both explain past events and foresee potential future ones.
A model of the economy's importance
Its main goal is to describe and examine the prices and volume sold in a market that is competitive. In relation to price and other factors, the equations of the model define the level of supply and demand (for example, income).
What conclusions do economic models draw?
A simplified representation of reality, an economic model enables us to observe, comprehend, and forecast economic phenomena. A model's goal is to simplify a complex, real-world scenario so that only the most important elements remain.
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Projects are temporary endeavors whereas an organisation's operations are ongoing in nature.The Role of a project sponsor is to provide direction and funding for a project. In this case, Steve is working with his project team and support staff to ensure the project is completed on time and the project sponsor is Robinson family.
Answer:
e
Explanation:
the present value factor is the discount rate used to determine the present value of the investment
pv factor = 1 / (1 + r)^n
1 / 1.15^3 = 0.6575
The supply of the product tend to be more inelastic when the prices of the goods are high. Supply inelasticity is caused by the sudden change of the price of goods needed to release the supply and more often than not, that change of price is a price hike; meaning, the increase of price reasonable or not.
Option d. $35.00 is the share price that one should pay for the stock today to get the required return
The share price, or the price you will pay for the company's stock right now, can be calculated using the necessary rate of return calculation, the formula is as follows:
RRR=(EDP/SP)+DGW
where;
RRR=required rate of return
EDP=expected dividend payment from share
SP=share price
DGW=dividend growth rate
In our case:
RRR=15.40%=15.4/100=0.154
EDP=$2.80
SP=unknown
DGW=7.40%=7.40/100=0.074
Substituting the values in the formula we get the following:
0.154=(2.80/SP)+0.074
(0.154-0.074)=(2.80/SP)
0.08=2.80/SP
SP=2.80/0.08
So, the share price of the stock=$35
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