Answer:
Ks = 4%+6% = 10%
Explanation:
so we need to remember that tax rate doesn't affect Cost of equity
in this case the formula will be:
cost of equity is equal to=dividend yield+Growth rate or Ks = D1/P + g
Camp Company's expected dividend yield ( D1) is 4%
growth rate is 6%
SO we get Ks = 4%+6% = 10%
Answer:
Option (C) is correct.
Explanation:
Expected value of a particular activity indicates about the profit or loss incurred from that activity. An investor uses the expected value for comparing the money spent on that activity and amount of money gained from that activity or transaction. Hence, according to the expected value of the investment, investor decide whether to invest or not.
Therefore, expected value of zero indicates that the amount of money spent on a particular investment is exactly equal to the money gained from that investment. This point is also known as break-even point.
<span>What is the periodic interest rate of Melanie's investment?
How many compounding periods does Melanie's investment offer in a year? How about in 8 year?
Semiannually means that it is twice in a year, then:
- the number of compounding periods in a year is 2.
- the number of compounding periods in 8 years is 2 * 8 = 16
What expression can Melanie write to figure out how much her investment will be worth in 8 years?
Use the formula : F = P * ( 1+ r/n) ^ (n*t)
P is the initial investment = $12,000
n = the number of periods per year, which is 2
</span>
<span><span>r is the yearly rate = 4.8% = 0.048
t is the number of years, which is 8.
Then, the equation is F = $12,000 * ( 1 + 0.048/2) ^ (8*2) =
= $12,000 ( 1+ 0.024)^ 16 = $12,000 (1,024)^16
</span>
How much will Melanie's investment be worth in 8 years?</span>
Just use the calculator: 12,000 (1,024)^16 = $17,538
Answer:The profit is $740
Explanation:4(500)-[3(320)+300]
4x500=2000
3x320=960+320=1260
2000-1260=$740
Answer:
a. The Geometric average return is 1.72%
b. The Arithmetic average return is 1.75%
c. The Dollar weighted average return is 2.61%
Explanation:
a) In order to calculate the time-weighted geometric average return we would have to calculate first the Holding period return as follows:
Holding period return = (200 - 190) / 190 = 5.263%
Hence, Geometric average return = (1 + .05263)^(1/3) - 1 = 1.72%
b) To calculate time-weighted arithmetic average return we have to make the following calculation:
Arithmetic average return = 5.263% / 3 = 1.75%
c) To calculate time-weighted arithmetic average return we would have to make the following calculation:
Dollar weighted average return=-190*3 + 200/(1+r) + 200/(1+r)^2 + 200 / (1+r)^3 = 0
= 2.61%