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IgorLugansk [536]
3 years ago
7

Graphical Designs is offering 20-20 preferred stock. The stock will pay an annual dividend of $20 with the first dividend paymen

t occurring 20 years from today. The required return on this stock is 5.10 percent. What is the price of the stock today?
Business
1 answer:
Anastaziya [24]3 years ago
7 0

Answer:

$ 152.35  

Explanation:

The stock price today can be computed by first determining the future value of the dividend in perpetuity ,then discounting that to present value.

Value in perpetuity=dividend/required return

dividend is $20

required return is 5.10%

value in perpetuity=$20/5.10%=$392.16

The price of the stock today is the present value of the value in perpetuity

PV=FV*(1+r)^-n

FV is $392.16

r is the required return of 5.10%

n is the number of years involved,which is 19,it is 19 because counting from today till the next next years would be first day of the next twenty years

price=$392*(1+5.10%)^-19=$ 152.35  

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b. $44,500

Explanation:

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Direct material used             $12,500

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iVinArrow [24]

National Housing Federation establishes relationships with financial institutions to offer homeownership programs that include down payment assistance through grants and favorable terms.

<h3>What is National Housing Federation?</h3>
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  • NHF assists its members in achieving that social purpose through ambitious work that results in positive change.
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Therefore, National Housing Federation establishes relationships with financial institutions to offer homeownership programs that include down payment assistance through grants and favorable terms.

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Answer:

Tell her that it will take a very long time

Explanation:

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2 years ago
A flatter, more horizontal demand or supply curve ____
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Complete the sentence.
valentina_108 [34]

Answer:

Imagine that you have won $100 in the state lottery. You have a choice between spending the money on shopping now or putting it away in a

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The opportunity cost is the price you pay for not choosing best second alternative when you make a decision. In this case the person has two options:

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Once the money is spending the opportunity costs is generated and it is measure by the interest rate lost for not keeping the money in a savings account that will generate an interest rate known as APY Annual Percentage Yield.  

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