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laila [671]
3 years ago
9

Woidtke Manufacturing's stock currently sells for $29 a share. The stock just paid a dividend of $2.60 a share (i.e., D0 = $2.60

), and the dividend is expected to grow forever at a constant rate of 6% a year. (a) What stock price is expected 1 year from now? Do not round intermediate calculations. (b) What is the estimated required rate of return on Woidtke's stock? Round your answer to the nearest cent.
Business
2 answers:
Sholpan [36]3 years ago
7 0

What stock price is expected 1 year from now? $ 37.1

What is the estimated required rate of return on Woidtke's stock? 15.50%

<h3>Explanation: </h3>

A stock market is where investors meet to buy and sell shares. Stocks are an equity investment represented the part ownership in the corporation and entitles you to part of that corporation's earnings and assets

A dividend is the payment by a corporation to its shareholders, as a distribution of profits. A shareholder is individual or institution legally owns one or more shares of stock in corporation.

Stock price or share price is the price of a single share of a number of saleable stocks of a company, derivative or other financial asset.

Woidtke Manufacturing's stock currently sells for $29 a share. The stock just paid a dividend of $2.60 a share (i.e., D0 = $2.60), and the dividend is expected to grow forever at a constant rate of 6% a year.

(a) What stock price is expected 1 year from now? Do not round intermediate calculations.

29*1.06 = 37.1

$ 37.1

(b) What is the estimated required rate of return on Woidtke's stock? Round your answer to the nearest cent.

=\frac{(2.60*1.06)}{29}  + 0.06\\

= 15.50 %

Learn more about stock price : brainly.com/question/2017025

#LearnWithBrainly

3241004551 [841]3 years ago
6 0

Answer: Price after 1 year = $24.83

Explanation:

Return = [D1/P0 ]+ g

= [(3*1.08)/23] + 0.08

= 22.09%

We assume the return is same for next year as well.

Thus,

r = [D2/P1] + g

22.09% = (3*1.082/P1) + 8%

P1 = $24.83

<u>Thus, price after 1 year is $24.83</u>

<u />

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Answer:

Economic Dimension

Explanation:

Economic dimension implies that the effect of economic factors on a particular circumstance which a company faces are taking into consideration while making a decision.

In the question, the three economic factors mentioned to be considered by the company as part of the economic dimension are Consumer Price Index, manufacturing and retail inventory levels, and consumer confidence measures.

The Consumer Price Index (CPI) measures the weighted average of prices of a basket of commodities like cloth, food, transportation, etc. This is calculated as average of the changes in prices of the chosen basket of goods and services.

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Consumer confidence measure can also be referred to as the Consumer Confidence Index (CCI) and it is the level of assurance which consumers display about general economic condition in a country through the way they spend or save.

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4 0
2 years ago
Which of the following statements is correct? Managers will be more likely to pursue projects that will benefit the entire compa
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A.Incorrect

B. Incorrect

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a) A manager might reject a proposal using ROI that the manager would accept using residual income

The statement is incorrect. The reverse is true. Using ROI entails the manager comparing the ROI after a project to the ROI before, where implementing a project makes the ROI after to be less than what it before the project, the Manager would most likely not implement the project. This would happen notwithstanding that the project  produces positive residual income.

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3 0
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If a buyer's willingness to pay for a new Honda is $30,000 and she is able to actually buy it for $28,000, her consumer surplus
dalvyx [7]

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3 years ago
A telephone customer service center wants to ensure that the majority of its customers’ calls are answered within a reasonable a
mr_godi [17]

Answer:

The Capability Index for this process is 1.04. The right answer is B

Explanation:

According to the given data we have the following:

μ = 31 Seconds

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Therefore, in order to calculate the Capability Index for this process we would have to use the following formula:

Cpk=Min<u>( USL-μ</u>  ,  <u>μ- LSL</u>)

               3×σ            3×σ

Cpk=Min<u>( 45-31</u>  ,  31<u>- 10</u>)

               3×4.5      3×4.5

Cpk = Min ( 1.04,1.56) = 1.04

The Capability Index for this process is 1.04

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