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
Nataliya [291]
3 years ago
6

The ZZZ Corporation has preferred stock. The preferred stock pays a dividend per share every year of $6.50. The stock sells for

$81.25 per share. TRUE or FALSE: The required return of investors in the stock is 8%.
Business
2 answers:
defon3 years ago
8 0

Answer:

True

Explanation:

The statement is true because according to dividend growth method the price of the given preferred stock is $81.25.

Formula to calculate the prce of share using Dividend growth method is

Price of share = D0 / (Rate of return - Growth rate)

In case of preferred stock a stable dividend is paid and there is no growth in the dividend payment.

so

Price of share = D0 / (Rate of return - 0)

Price of share = D0 / Rate of return

Share price = $6.5 /  0.08

Share Price = $81.25

Furkat [3]3 years ago
8 0

Answer:

The answer to the question is<em> YES</em>

Explanation:

What is Return on Investment (ROI)?

Return on investment (ROI) is a financial ratio used to calculate the benefit an investor will receive in relation to their investment cost. It is most commonly measured as net income divided by the original capital cost of the investment. The higher the ratio, the greater the benefit earned.

Therefore, the formula to find the Return on Investment for the question - The ZZZ Corporation has preferred stock. The preferred stock pays a dividend per share every year of $6.50. The stock sells for $81.25 per share. TRUE or FALSE: The required return of investors in the stock is 8%.

ROI = Net Profit ÷ Total Investment x 100

∴ $6.50 = Net Profit (Yearly Dividend par share);

   $81.25 = Total Investment (Market Price of the stock);

Applying the formula: 6.50/81.25 x 100 =7.97≅ 8% (approximately)

You might be interested in
Investors who put their own money into a startup are known as
konstantin123 [22]

Hi there!

Investors who put their own money into a startup are known as angel investors. Also, they are usually family or friends but don't have to be.

The closest answer to angel investors is C. Angels.

I hope that helps u! :)

3 0
3 years ago
Read 2 more answers
Write a claim that responds to the question: Why can transferring energy into or out of a substance change molecules' freedom of
nydimaria [60]

Answer:

hope this help u

Explanation:

Transferring energy into or out of a substance changes its temperature, which changes the molecules' freedom of movement. Claim 2: Transferring energy into or out of a substance changes the molecules' kinetic energy, which changes their freedom of movement.

8 0
3 years ago
A financial intermediary is a corporation that takes funds from investors and then provides those funds to those who need capita
kondaur [170]

Answer: The statement is <u>TRUE.</u>

Financial intermediaries are those people or companies that offer financial services to the investor without the latter having to contact the issuer of the financial instrument.

Its function is that of intermediation between people who save and people who need financing, that is, between buyers and sellers.

4 0
3 years ago
Two economists estimate the government expenditure multiplier and come up with different results. One estimates the multiplier a
madreJ [45]

Answer:

B. Compared to the first​ economist, the second economist must be assuming either a larger induced increase in​ consumption, a smaller crowding out​ effect, or both.

Explanation:

6 0
3 years ago
When Colgate encourages its current customers to brush more often by taking their toothbrush and toothpaste to work with them, w
choli [55]

Answer:

Market penetration.

Explanation:

Market penetration is one of the strategies used by marketers to gain market share and increase sales volume. This strategy has been used to sell existing goods and services of the company to the existing market or new market by using a different technique and schemes like discounts, bundling of products, offers, etc to improve sales volume and get a competitive advantage. It is measured by the volume of goods and services been used by the consumer in comparison to other competitor and it´s a share in the total market.

3 0
3 years ago
Other questions:
  • A research __________ is any material that can be used to locate information about a given topic.
    9·2 answers
  • The manager of a gas station has observed that the times required by drivers to fill thier car's tank and pay are quite variable
    14·2 answers
  • A member firm receives a large block order to buy 100,000 shares of XYZ stock, which is not actively traded. Which customer(s) o
    11·1 answer
  • A __________ visually shows that the total revenue curve and the total cost curve intersect at a point of zero profit.
    12·1 answer
  • Wilson Enterprises applies overhead based on direct labor cost. The company estimates that their overhead for the year will be $
    15·1 answer
  • Asking a job candidate his or her marital status is
    14·2 answers
  • Omega corporation and precision products, inc., are the principal suppliers of their product in their market. they agree that om
    15·1 answer
  • The appropriate journal entry to transfer the cost of completed units from the Work in Process account would involve a credit to
    11·1 answer
  • Click this link to view O*NET's Work Activities section for Reporters and Correspondents.
    13·2 answers
  • In the context of the different techniques used by an inference engine to manipulate a series of rules, _____ refers to a series
    6·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!