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liq [111]
3 years ago
6

Stock XYZ has a current dividend of $6.00 . The dividend is expected to grow at 4.00% per year until year 3 and then at 3.00% pe

r year for the rest of time. Based on the riskiness XYZ, its discount rate is 7.00% . With this information, what is the dividend yield from today to year 1?
(A) 7.00%
(B) 3.73%
(C) 4.00%
(D) 4.12%
(E) 3.93%
(F) 3.07%
Business
1 answer:
Juliette [100K]3 years ago
5 0

Answer:

(E) 3.93%

Explanation:

year                     cash flows                         pv @7%           present value

1                              $6.24                              0.934579            $5.83

2                             $6.49                               0.87344              $5.67

3                             $6.75                                0.81630              $5.51

Price at year 3        $173.79                             0.81630             $141.87

                      (6.75*1.03)/(0.07-0.03)            

price today                                                                                   $158.88

Devidend yield = 6.24/158.88

                          = 3.93%

Therefore. The dividend yield from today to year 1 is 3.93%

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As an HR specialist at a large auto manufacturer, you have noticed that many of the technicians employed by your firm are bored
amid [387]

Answer:

A. Implementing a job rotation program

Explanation:

Implementing a job rotation program basically gives a view of the entire business, it cross-train employees and nurtures a future talent for improvement. It can be beneficial to both employer and employee.

6 0
3 years ago
When an accelerated depreciation method is used to calculate depreciation expense: Multiple Choice the accumulated depreciation
erastovalidia [21]

Answer:

the net book value of the asset halfway through its useful life will be less than if straight-line depreciation is used.

Explanation:

Let me use an example to illustrate this.

An asset has a useful life of 4 years. It costs $1000. It has a salvage value of 0

If the straight line depreciation method is used , the depreciation expense every year = $1000/ 4 = $250

The net book value halfway through its useful life = $1000 - ($250 x 2) = $500

If double declining method is used, the depreciation expense in the first year would be = 2/4 x $1000 = $500

The net book value at the beginning of year 2 = $1000 - $500 = $500

Depreciation expense in year 2 = 2/4 x $500 = $250

The net book value at the beginning of year 3 = $500 - $250 = $250

We can see that the net book value halfway through the useful is lower when double declining depreciation method is used

4 0
3 years ago
Alexis Incorporated sells two products, larges and smalls. Larges sell for $94 per unit with variable costs of $62 per unit. Sma
blagie [28]

Answer:

The break even point is 505 units.

Explanation:

Alexis Incorporated sells two products, larges and smalls.

Larges sell for $94 per unit with variable costs of $62 per unit.

Smalls sell for $27 per unit with variable costs of $10 per unit.

Total fixed costs for the company are $14,000.

The contribution margin per unit for larges

= Sales - Variable costs

= $94 - $62

= $32

The contribution margin per unit for smalls

= Sales - Variable costs

= $27 - $10

= $17

At break even point the profits incurred is zero such that cost and revenue are equal.

\frac{5}{7}\ \times\ 94x\ +\ \frac{2}{7}\ \times\ 27x\ =\ \frac{5}{7}\ \times 62x\ +\ \frac{2}{7}\ \times\ 10x\ +\ \$ 14,000

67.14x + 7.71x = 44.28x + 2.85x + 14,000

74.85x = 47.13x + 14,000

x = \frac{14,000}{27.72}

x = 505.05

7 0
4 years ago
Sodium Services, Inc. (SSI) sponsors a SIMPLE for its employees with a 100% match up to 3% of compensation. Mary, age 42, has be
eimsori [14]

Answer:

The maximum matching contribution to Mary’s SIMPLE from SSI is (b) $1,050

Explanation:

Since SSI uses a 100% match up to 3% of compensation, the matching contribution from SSI to Mary's SIMPLE plan would be

(3% x $35000) = 1.050,00

The maximum matching contribution to Mary’s SIMPLE from SSI is (b) $1,050

8 0
4 years ago
uppose you observe the following exchange rates: €1 = $1.50; £1 = $2.00. Calculate the euro-pound exchange rate. A. €1.25 = £1.0
choli [55]

Answer:

D. €1.3333 = £1.00

Explanation:

Suppose you observe the following exchange rates: €1 = $1.50; £1 = $2.00.

That implies that the value of €1 is equivalent to 1.50/2.00 the value of £1, since €1 = $1.50; £1 = $2.00

Therefore the value of €1 = £0.75

Hence the value of  £1 = €1 / £0.75 = €1.3333

3 0
4 years ago
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