1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
anygoal [31]
3 years ago
8

Suppose Compco Systems pays no dividends but spent $ 4.92 billion on share repurchases last year. If​ Compco's equity cost of ca

pital is 12.6 %​, and if the amount spent on repurchases is expected to grow by 8.9 % per​ year, estimate​ Compco's market capitalization. If Compco has 6.3 billion shares​ outstanding, to what stock price does this​ correspond?
Business
1 answer:
RUDIKE [14]3 years ago
4 0

Answer:

$144.81 bil or $22.99 per share

Explanation:

We can apply discounted dividend model (DDM) to value the stock in this example because share repurchase is equivalent to cash dividend, which are both cash paid out to shareholders of the company.

DDM is stated as below:

V_o = [D_o x (1 + g)]/(r - g), where:

V_o: Intrinsic value of the company

D_o: Current dividend or Share repurchased in cash;

g: Dividend growth;

r: cost of equity.

Putting all the number together, we have:

V_o = [4.92 x (1 + 8.9%)]/(12.6% - 8.9%) = 144.81 bil or 144.81/6.3 = 22.99 per share

You might be interested in
Rafner Manufacturing identified the following budgeted data in its two production departments. Assembly Finishing Manufacturing
miss Akunina [59]

Answer:

1. $53.75 per direct labor hour

2. $80.625 per machine hour

Explanation:

Total manufacturing overhead costs= $1112500+$500000  = $1612500

Total direct labor hours= 11000+19000=30000

Total machine hours= 5000+15000=20000

1.       Company’s single plantwide overhead rate based on direct labor hours

= Estimated overhead costs/Estimated direct labor hours

=$1612500/30000 =$53.75 per direct labor hour

2.       Company’s single plantwide overhead rate based on machine hours

= Estimated overhead costs/Estimated Machine hours

=$1612500/20000 =$80.625 per machine hour

3 0
3 years ago
Read 2 more answers
What are three reasons to study economics?
klemol [59]
Knowledge , pride and wisdom
3 0
3 years ago
Sarasota Company has a factory machine with a book value of $86,300 and a remaining useful life of 7 years. It can be sold for $
RUDIKE [14]

Answer:

See the explanation for answer

Explanation:

Analysis showing whether the old machine should be retained or replaced is as prepared below:

                                                     Retain        Replace            Net Income

                                              Equipment     Equipment      Increase(Decrease)                            

Variable manufacturing costs 43,63,100 32,32,600 11,30,500

New machine costs                     0    3,59,000 -3,59,000

Sell old machine                             0          -33,500          33,500

Total                                       43,63,100   35,58,100   8,05,000

The old factory machine should be replaced as there is increase in net income by 805,000 when old machine is replaced.

4 0
3 years ago
This program will store roster and rating information for a soccer team. coaches rate players during tryouts to ensure a balance
Vedmedyk [2.9K]

Answer:

Explanation:

#include <iostream>

#include <vector>

using namespace std;

int main() {

   vector<int> jerseyNumber;

   vector<int> rating;

   int temp;

   for (int i = 1; i <= 5; i++) {

       cout << "Enter player " << i

            << "'s jersey number: ";

       cin >> temp;

       jerseyNumber.push_back(temp);

       cout << "Enter player " << i

            << "'s rating: ";

       cin >> temp;

       rating.push_back(temp);

       cout << endl;

   }

   cout << "ROSTER" << endl;

   for (int i = 0; i < 5; i++)

       cout << "Player " << i + 1 << " -- "

            << "Jersey number: " << jerseyNumber.at(i)

            << ", Rating: " << rating.at(i) << endl;

   char option;

   '

   while (true) {

       cout << "MENU" << endl;

       cout << "a - Add player" << endl;

       cout << "d - Remove player" << endl;

       cout << "u - Update player rating" << endl;

       cout << "r - Output players above a rating"

            << endl;

       cout << "o - Output roster" << endl;

       cout << "q - Quit" << endl << endl;

       cout << "Choose an option: ";

       cin >> option;

       switch (option) {

           case 'a':

           case 'A':

               cout << "Enter a new player's"

                    << "jersey number: ";

               cin >> temp;

               jerseyNumber.push_back(temp);

               cout << "Enter the player's rating: ";

               cin >> temp;

               rating.push_back(temp);

               break;

           case 'd':

           case 'D':

               cout << "Enter a jersey number: ";

               cin >> temp;

               int i;

               for (i = 0; i < jerseyNumber.size();

                    i++) {

                   if (jerseyNumber.at(i) == temp) {

                       jerseyNumber.erase(

                               jerseyNumber.begin() + i);

                       rating.erase(rating.begin() + i);

                       break;

                   }

               }

               break;

           case 'u':

           case 'U':

               cout << "Enter a jersey number: ";

               cin >> temp;

               for (int i = 0; i < jerseyNumber.size();

                    i++) {

                   if (jerseyNumber.at(i) == temp) {

                       cout << "Enter a new rating "

                            << "for player: ";

                       cin >> temp;

                       rating.at(i) = temp;

                       break;

                   }

               }

               break;

           case 'r':

           case 'R':

               cout << "Enter a rating: ";

               cin >> temp;

               cout << "\nABOVE " << temp << endl;

               for (int i = 0; i < jerseyNumber.size();

                    i++)

                   if (rating.at(i) > temp)

                       cout << "Player " << i + 1

                            << " -- "

                            << "Jersey number: "

                            << jerseyNumber.at(i)

                            << ", Rating: "

                            << rating.at(i) << endl;

               break;

           case 'o':

           case 'O':

               cout << "ROSTER" << endl;

               for (int i = 0; i < jerseyNumber.size();

                    i++)

                   cout << "Player " << i + 1 << " -- "

                        << "Jersey number: "

                        << jerseyNumber.at(i) << ", Rating: "

                        << rating.at(i) << endl;

               break;

           case 'q':

               return 0;

           default:

               cout << "Invalid menu option."

                    << " Try again." << endl;

       }

   }

}

4 0
3 years ago
postal express is considering the purchase of a new sorting machine. the sales quote consists of quarterly payments of $37,200 f
Cloud [144]

The five-year sales quote includes quarterly payments of $37,200 at a 7.6% interest rate. The price of the acquisition is $614,184.40.

<h3>Do you mean by PMT payment?</h3>

PMT stands for "payment," therefore the name of the function. A PMT method can estimate your monthly payments, for instance, if you are looking for a $30,000 car loan with a two-year term and an annual interest rate of 7%.

<h3>In the fv formula, what is PMT?</h3>

PV = present value, and FV=PMT(1+i)((1+i)N - 1)/i Future Value (FV) Payment per period (PMT) I = percent per period interest rate N is the number of cycles.

Quarterly Payment = PMT = $37,400

Interest Rates = r = 7.6% per year = 0.076 per year = 0.076 / 4 = 0.019 per quarter

Number of years = 5 years

Number of Payment = n = 5 years x 4 quarters per year = 20 quarters

PV = PMT x (1 - [1 / (1 +r)^n]) / r

PV = $37,200 x (1 - [1 / (1 +0.019)^20]) / 0.019

PV = $614,184.40

Learn more about PMT: brainly.com/question/12890163

#SPJ1

5 0
1 year ago
Other questions:
  • Hannigan Lumber employs 155 workers. One of the firm's former employees used the Civil Rights Act of 1991 to file and win a disc
    10·1 answer
  • Members of mid-south petroleum distributors, a trade group, had trouble obtaining affordable pollution liability insurance. the
    11·1 answer
  • Nations that have the strongest product liability laws tend to be well- developed economically However, the general case in deve
    7·1 answer
  • Changes in nominal GDP over time ... Select one: a. ... reflect changes in the quantity of goods and services produced, their pr
    5·1 answer
  • Instead of deciding to finish high school, you could have decided to work full-time. How would an economist explain your decisio
    12·1 answer
  • Business Solutions's second-quarter 2020 fixed budget performance report for its computer furniture operations follows. The $162
    14·1 answer
  • Suppose that shortly after graduating from college you decide to start your own business. Assuming you are starting a small busi
    10·1 answer
  • Aggregate demand is the of all goods and services (Real GDP) at different price levels, ceteris paribus. If a person has $100,00
    15·1 answer
  • Kant Corporation retires its $500,000 face value bonds at 102 on January 1, following the payment of interest. The carrying valu
    9·1 answer
  • The stock of NorthPoint Corporation is currently selling for $10 per share. Earnings per share in
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!