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Mars2501 [29]
3 years ago
8

Antiques ‘R’ Us is a mature manufacturing firm. The company just paid a dividend of $12.00, but management expects to reduce the

payout by 5.25 percent per year, indefinitely.
Required:
If you require a return of 10 percent on this stock, what will you pay for a share today? (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)
Business
1 answer:
dedylja [7]3 years ago
5 0

Answer:

Check the explanation

Explanation:

Using the constant growth model which can be applied even if the dividends to be paid are declining by a constant or stable percentage, you just have to make sure that the negative growth is recognized. So, the price of the stock as at today will be calculated like:

P 0 = D 0 (1 + g ) / ( R – g )

P 0 = $11.40(1 – 0.0475) / [(0.08 – (–0.0475)]

P 0 = $85.16

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Option A
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Full-time employees must have money deducted from their paychecks for
DedPeter [7]

The correct answer is C. Federal income tax

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5 0
4 years ago
Which of the following will shift the aggregate demand curve to the left?
lisov135 [29]

Answer:

A. Interest rates rise.

C. There is an economic boom overseas that raises the incomes of foreign households.

Explanation:

Option A - It is correct because if the interest rate increases, consumer spending will decline. Therefore, the aggregate demand curve will shift to the left.

Option B - If the government reduces the personal income tax, the consumers will spend more, it will lead the aggregate demand to the right. So, it is wrong.

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