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
svet-max [94.6K]
3 years ago
15

Cost of common stock: Whitewall Tire Co. just paid a $1.60 dividend on its common shares. If Whitewall is expected to increase i

ts annual dividend by 2 percent per year into the foreseeable future and the current price of Whitewall common shares is $11.66, what is the cost of common stock for Whitewall
Business
1 answer:
krek1111 [17]3 years ago
3 0

Answer:

Cost of common stock for Whitewall is 16.00%

Explanation:

Ke = D1 / Price +g

D1 = Ke (Price + g)

D1 = $1.60 * (1+0.02)

D1 = $1.60 * (1.02)

D1 = $1.632

Ke = D1 / Price +g

We solve for Current dividend to derive the Cost of common stick  

Ke = 1.632 / (11.66) + 2%

Ke =  1.632 / 11.66 + 0.02

Ke =  0.139966 + 0.02

Ke =  0.159966

Ke =  15.9966%

Ke =  16.00%

You might be interested in
member of the production team skilled in research and analysis, who helps actors, designers, and directors better understand the
monitta

Answer:

Dramaturg

Explanation:

Dramaturg is the term which is defined as the editor or the literary adviser in the film company, theatre or opera, who researches, texts, selects, interprets scripts and printed programmes, does the public relations work.

So, in this case, the member of the production team who helps the directors, actors as well designers to better understand the specifications of the play is referred to the Dramaturg.

4 0
3 years ago
Your friend brought up an investment opportunity that will generate cash flows of $5,000, $5,300, and $6,000 next three years, r
ahrayia [7]

Answer:

The most I could pay for the investment is $12,960.09  

Explanation:

The maximum a rational investor could pay acquire an investment is the present value of all future cash flows receivable from the investment.

In the case, the present of all cash flows is calculated thus:

Years  Cashflows [email protected] 12% PV

1          5000 0.892857143  4,464.29  

2          5300 0.797193878  4,225.13  

3           6000 0.711780248  4,270.68  

   Total of present values               12,960.09

The discounting factor is calculated using the formula :

1/(1+r)^n where r and n are rate and number of years respectively.                                          

8 0
3 years ago
What is the opportunity cost of an investment?
anzhelika [568]

Answer:

B. The value of the next most valuable opportunity.

Explanation:

The opportunity cost of an investment is the value of the next most valuable opportunity.

7 0
3 years ago
Read 2 more answers
A business must decide whether to open a new office in China. If it opens the
ivolga24 [154]
D a is the correct answer I’m pretty sure
4 0
3 years ago
Rounding off statistics _____.
Delicious77 [7]

Rounding off statistics helps the audience remember them better. There are many things that should be done when talking about statisics and going over them but out of the above choices, the most correct is making sure that the audience remembres and understands the statsitics. Statistics will not be remember by many when they are a long series of numbers even if they are as exact as it can be,

7 0
3 years ago
Other questions:
  • Ten years​ ago, Latesha acquired a one-third interest in Dana​ Associates, a​ partnership, for​ $26,000 cash. This​ year, Latesh
    7·1 answer
  • A cell phone company introduced its brand-new 5G phone into the market. The phone featured global network capability, the fastes
    14·1 answer
  • Calculate the Marginal Utilities and Marginal Rate of Substitution for each of the Utility functions below. (Remember, marginal
    7·1 answer
  • Barry has a successful methamphetamine laboratory. Producing methamphetamine is illegal under federal law. Is Barry required by
    11·1 answer
  • Johnny has 15 toys with a total value of $125. If some of Johnny's toys are worth $5 and the others are worth $10, how many toys
    7·1 answer
  • If shondra really wants to borrow alicia's shoes but she thinks she may refuse, the idea of the foot-in-the-door technique state
    14·1 answer
  • A manager must make a decision on shipping. There are two shippers, A and B. Both offer a two-day rate: A for $522 and B for $53
    10·1 answer
  • REM Consulting is completing the accounting information processing at the end of the fiscal year, December 31. The following tri
    7·1 answer
  • It is fairly easy for coaches to put aside prejudices when selecting team members, determining the starting lineup, or assigning
    11·2 answers
  • Column A
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!