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tankabanditka [31]
3 years ago
11

1) Michael's, Inc., just paid $1.95 to its shareholders as the annual dividend. Simultaneously, the company announced that futur

e dividends will be increasing by 4.3 percent. If you require a rate of return of 8.5 percent, how much are you willing to pay today to purchase one share of the company's stock? 2PTS
Business
1 answer:
Marizza181 [45]3 years ago
5 0

Answer:

Price we are wiling to pay = $46.429

Explanation:

Hi, this can be calculated using the dividend discount model

Stock price we are willing to pay  = D / (r - g) where,

D = Dividend

r = required rate of return of investor

g = growth

So working the formula gives us,

Price = 1.95 / (0.085 - 0.043)

Price = $46.429

This is the price we are willing to pay.

Hope that helps.

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Answer:

Option D is correct one.

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Answer:

<u>Press, Speech & Religion </u>

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As per The First Amendment, the Congress had been prohibited to make any such laws which restrict an individual's freedom of speech, curtail the freedom of press or those which in any form promote or curb any religion.

In the given case, Mike, an advocate, supports a certain religion and went on to publish an article in a magazine, expressing his views and insisting upon Congress to base Federal Laws as per the principles of his religion.

The First amendment guarantees Mike, the freedom of speech i.e expression, freedom to practice the religion of his choice and the freedom of press i.e the freedom to publish an article expressing his views in a magazine.

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If, in the market for money, the amount of money supplied exceeds the amount of money households and businesses want to hold, the interest rate will  rise, causing households and businesses to hold less money.

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