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
Zanzabum
3 years ago
9

Constant Dividend Growth Valuation Boehm Incorporated is expected to pay a $3.00 per share dividend at the end of this year (i.e

., D1 = $3.00). The dividend is expected to grow at a constant rate of 4% a year. The required rate of return on the stock, rs, is 13%. What is the estimated value per share of Boehm's stock? Do not round intermediate calculations. Round your answer to the nearest cent.
Business
1 answer:
DerKrebs [107]3 years ago
5 0

Answer:

The value of the stock today is $33.33

Explanation:

The constant growth model of the DDM approach will be used to calculate the value of this stock today.

The formula for Value of the stock today using the constant growth model is,

V or P0 = D1 / r - g

The Value of the stock today is,

V or P0 = 3 / (0.13 - 0.04)

V or P0 = $33.33

You might be interested in
You borrow $210,000 to purchase a home. the terms of the loan call for monthly payments over 30 years at a mortgage rate of 4.50
Dmitry_Shevchenko [17]
First step, find the monthly payments.
Borrowed amount, P = 210000
Monthly interest, i = 0.045/12
Number of periods, n = 30*12=360

Monthly payment
A=\frac{P(i*(1+i)^n)}{(1+i)^n-1}
=\frac{210000(0.045/12*(1+0.045/12)^360)}{(1+0.045/12)^360-1}
=1064.0392    [to the 1/100 of a cent]


2. Calculate interest accumulated over 60 months
I=210000((1+0.045/12)^{60}-1)
=52877.12

3. Calculate value of payments
F=\frac{A((1+i)^n-1)}{i}
=\frac{1064.039150634359((1+0.045/12)^{60}-1)}{0.045/12}
=71445.50    to the nearest cent

4. Calculate percentage of interest paid
A. as a fraction of future values
Percentage of interest
=52877.12/71445.50
=74.01%
As a fraction of total amounts paid
Percentage of interest
=52877.12/(60*1064.0392)
=52877.12/63842.35
=82.82%
6 0
3 years ago
A sales manager announces that all weekly sales reports must be submitted via e-mail, rather than hardcopy. However, some of the
slamgirl [31]

Answer:

d. Stressing that younger staff members have no problem e-mailing their reports.

Explanation:

Option A - If sales manager provides all the required hardware, software, and training, it can be the best effective way to change other staffs' motives.

Option B - If sales manager explains the importance of electronic submissions, it should be the best way of winning over those who are resist to change.

Option C - If sales manager praises other staff members, those who do not want to change will change their motive and send electronically.

Therefore, all the options A, B, and C are the best effective ways, so, D is the best option which is least likely way to change.

4 0
3 years ago
In a department, 28,000 units are completed and transferred out and 14,400 remain in ending WIP at 85% complete. If an equivalen
Zigmanuir [339]

Answer:

The value of materials transferred out is $224,000

Explanation:

The condition for the units for transferred is that they must have been completed 100% with respect to equivalent unit cost,hence the materials transferred out should be valued at full $8.00 per direct material.

The value of materials transferred out=28,000*$8.00

                                                              =$224,000

The value of WIP=$8.00*85%*14,400

                           =$97,920

The closing WIP of $97920  would be the beginning inventory in production next period an would ultimately form part of materials completed and transferred next period.

8 0
3 years ago
MC Qu. 112 A company is considering... A company is considering the purchase of new equipment for $105,000. The projected annual
Alina [70]

Answer:

Net Present Value =  $660.98  

Explanation:

<em>The Net present value (NPV) is the difference between the Present value (PV) of cash inflows and the PV of cash outflows. A positive NPV implies a good and profitable investment project and a negative figure implies the opposite. </em>

NPV of an investment:  

NPV = PV of Cash inflows - PV of cash outflow  

<em>PV of cash inflow = A× (1- (1+r)^(-n))/r </em>

A- annul cash inflow, r- 8%, n- 3

PV of cash inflow= 41,000× (1- 1.08^(-3))/0.08

=   105,660.98  

Initial cost = 105,000

NPV =  105,660.98  - 105,000

= $  660.98  

3 0
3 years ago
Suppose your firm receives a $ 3.2 million order on the last day of the year. You fill the order with $ 1.7 million worth of inv
klio [65]

Answer and Explanation:

The consequences of given transactions are as follows

a. Revenues rise by $3.2 million  as the firm received an order

b. Earnings rise by $1.5 million  as the firm received an order and it filled by an orders i,e ($3.2 - $1.7)

c. Receivables rise by $1.80 million  as it determines the remaining balance which ultimately increased the receivable balance

d. Inventory declined by $1.7 million  as the order is filled which ultimately declines the stock

e. The cash would rise by $1.4 million

= Earnings - receivable + inventory

= $1.5 million - $1.80 million + $1.7 million

= $1.4 million

4 0
3 years ago
Other questions:
  • g A project has an initial cost of $6,900. The cash inflows are $850, $2,400, $3,100, and $4,100 over the next four years, respe
    8·1 answer
  • Assume the MPC is 0.8. Assuming only the multiplier effect matters, a decrease in government purchases of $100 billion will shif
    11·1 answer
  • The first thing you must consider in any type of communication is
    6·2 answers
  • What is psychology? ​
    6·2 answers
  • Transactional leaders try to get people to do ordinary things while _________ leaders attemps to get people to do exceptional th
    15·1 answer
  • Farmer Elvin is holding 200 pounds of potatoes in storage for Chef Noble, but Chef Noble has breached the contract by failing to
    5·1 answer
  • Garth owns two all-terrain vehicles (ATVs), worth $1,000 and $500, respectively. Helen agrees to buy "Garth’s ATV" for $750. Gar
    15·1 answer
  • In 1999, the bureau of labor statistics reported that ? died from electrocutions at work, accounting for almost ? of all on-the-
    9·1 answer
  • Hardaway Fixtures' balance sheet at December 31, 2020, included the following: Shares issued and outstanding: Common stock, $1 p
    5·1 answer
  • According to the authors, the nature of negotiation as it applies to project management is the realization that few of the confl
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!