Answer:
the maximum price the investor would be willing to pay for a share of Spencer Co. common stock today is $86.27
Explanation:
The computation of the maximum price the investor would be willing to pay for a share of Spencer Co. common stock today is shown below:
Expected dividend is
= $3 × 6.2469
= $18.7407
Now the market value is
= $135 × 0.5002
= $67.527
So, the maximum price is
= $18.7407 + $67.527
= $86.27
hence, the maximum price the investor would be willing to pay for a share of Spencer Co. common stock today is $86.27
The true rate of interest that you pay on a loan is called the APR interest rates
Answer:
Compound interest is better than simple interest
Explanation:
Compound interest is better than simple interest especially when it comes to investing. Funds grow at a faster rate in compound interest than simple interest.
Simple interest is the interest on only the principal while compound interest is the interest on principal and on the previous accumulated interest (that is, interest on interest).
The formula for simple interest is:
P x r x t
Where P is the principal
r is the interest rate
t in the time.
For compound interest:
A=P(1+r/n)^nt.
A is the amount after compounding.
P is the principal.
r is the interest rate
n is the number of times interest compounds(adds up) per year
t is the number of years.
Answer:
$160,000
Explanation:
Calculation of the car dealership's profit
Using this formula
Profit= Total revenue- Amount Spend
Where,
Total revenue=$300,000
Amount Spend=$140,000
Let plug in the formula
Profit =300,000-140,000
Profit =160,000
Therefore the car dealership's profit will be $160,000
When buying or selling a futures contract, the trader commits what amount of funds the amount of the initial margin. A futures contract is a legal agreement to buy or sell assets, mainly commodities, at a set price but it will be delivered and paid for later. Based on the definition of a futures contract, the trader will have to commit to the initial amount that was set to be traded when the legal agreement was made.
