Answer:
Explanation:
Weighted Average Cost of Capital; formula is as follows;
WACC = wE*re + wP*wp + wD*rd(1-tax)
where w= weight of...
r = cost of ...
E= common equity
P = preferred stock
D = Debt
Find the weights of each source of capital;
WACC = (0.50*0.17) +(0.20*0.03) + [0.20*0.04(1-0.40)] +[0.10*0.07(1-0.40)]
WACC = 0.085 +0.006 + 0.0048 + 0.0042
WACC = 0.1 or 10%
Answer:
The the current dividend per share is $3.45
Explanation:
Solution
Recall that:
A company stock currently sells for =$80
the required return on the stock = 9%
The current dividend per share = ?
Now,
The dividend in year 1 pr D₁=80*(9%/2)=3.6
Thus,
The current dividend per share =3.6/ (1+4.5%)
= 3.45
When examining how price and demand changes will affect markets, it is important to consider how various goods are related. We can separate goods into 2 basic types: substitutes and complements. ... When the price increases for one good, the demand for the substitute will increase (assuming that price remains constant).
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