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Bad White [126]
4 years ago
14

The next dividend payment by Dizzle, Inc., will be $2.95 per share. The dividends are anticipated to maintain a growth rate of 4

.50 percent, forever. If the stock currently sells for $49.50 per share, what is the required return
Business
1 answer:
Darya [45]4 years ago
8 0

Answer: 10.46

Explanation:

To answer this we can use the Constant Growth Model of Stock Valuation. The formula is,

P = D1/(r-g)

Where,

P is the current price,

D1 is the next dividend

g is the expected growth rate in the dividend,

and r is the required rate of return for the company.

Seeing as we have everything else and it is the required return that we seek, let us make 'r' the subject of the formula.

P = D1/(r-g)

P(r-g) = D1

r-g = D1/P

r = D1/P +g

So,

r = 2.95/ 49.50 + 0.045

= 0.10459595959

= 10.46%

the required return is 10.46%

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An increase in input prices causes:___________
Svetach [21]

Answer: the market supply to shift inward, driving the equilibrium price higher.

Explanation:

An increase in input prices will result into a rise in the production costs. This will result in a leftward shift of the supply curve.

Therefore, the market supply will shift inward, driving the equilibrium price higher. This simply means that there will be lesser supply of the product and hence, increase in price.

5 0
3 years ago
A __________________ exists when the quantity demanded in the market is less than the quantity at the bottom of the long-run ave
kobusy [5.1K]

Answer:

Natural monopoly

Explanation:

A natural monopoly refers to a type of monopoly that occurs when the start-up costs or infrastructural costs are high or economies of scale in an industry are very powerful in such a way that only the largest supplier in the industry which is usually the first supplier in the market has a great advantage over potential competitors and therefore becomes the only supplier in the industry.

On the long-run average cost (LRAC) curve, a natural monopoly exists when the quantity demanded is less than the minimum quantity that is required to be at the bottom of the LRAC curve.

Therefore, a <u>natural monopoly</u> exists when the quantity demanded in the market is less than the quantity at the bottom of the long-run average cost curve.

6 0
4 years ago
Tom finds out that his coworker is sharing confidential information with a competitor. What should Tom do to handle the situatio
omeli [17]

i just asked my brother , and he goes to business school at bentley university in massachusetts, he said he was in a similar situation he said that reporting it to your supervisors is the best idea.



your welcome!!

5 0
3 years ago
Suppose Joe is maximizing total utility within his budget constraint. If the price of the last pair of jeans purchased is $25 an
inessss [21]

Answer:

80 units

Explanation:

Given:

  • Price: $25 we have: 100 units
  • Price: $20, how many units to maximize the total utility

Let X is the number of units we need to find

As we know that, the law of equal-marginal utility a consumer spends his or her income among goods so that utilities receive from the amount spent is equal. So we use a simple rule of three:

$25    100 units of utility

$20      X

<=> 25X = 20*100

<=> X = 80 units

Hope it will find you well.

6 0
3 years ago
You are the manager of a retail store. You believe the economy is in a recession and that sales for the month will be unusually
Schach [20]

Answer:

C) False consensus

Explanation:

False consensus refers to the trust what one feel regarding other and think as similar for other person as he thinks. Also in this the opinions of the other persons would not be considered

Since in the question it is mentioned that the majority of the other store managers would feel the same way so here the false consensus would be applied

hence, the correct option is c.  

4 0
3 years ago
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