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a_sh-v [17]
3 years ago
13

You are planning to purchase the stock of Ted's Sheds Inc. and you expect it to pay a dividend of $3 in 1 year, $4.25 in 2 years

, and $6.00 in 3 years. You expect to sell the stock for $100 in 3 years. If your required return for purchasing the stock is 12 percent, how much would you pay for the stock today
Business
1 answer:
Vika [28.1K]3 years ago
6 0

Answer:

$81.52

Explanation:

To determine the price of the stock, one has to calculate the present value of the stock.

The present value is the sum of discounted cash flows.

Present value can be calculated using a financial calculator

Cash flow in year 1 = $3

Cash flow in year 2 = $4.25

Cash flow for year 3 = $100 + $6 = $106

I = 12 %

Present value = $81.52

The price one would pay for the stock today is $81.52

To find the PV using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.

3. Press compute

I hope my answer helps you

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suppose that you are a member of the board of governors of the federal reserve system. the economy is experiencing a sharp rise
vivado [14]

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4 0
1 year ago
The board of commissioners of the City of Hartmoore adopted a General Fund budget for the year ending June 30, 2017, that includ
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Answer:

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8 0
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Characteristics of capital projects include: Group of answer choices Involves long-lived assets Usually requires long-range plan
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Characteristics of capital projects include (B) usually requires long-range planning and extensive financing.

<h3>What are capital projects?</h3>
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<h3>Characteristics of capital projects:</h3>
  1. Long-lasting assets are involved (e.g, buildings, roads and bridges, etc.)
  2. A construction project is usually included.
  3. Long-term planning and extensive financing are usually required.
  4. Maintain a project-life emphasis rather than a year-to-year concentration.

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Correct question:

Characteristics of capital projects include:

Group of answer choices -

(A) Involves long-lived assets.

(B) Usually requires long-range planning and extensive financing.

(C) Usually has a year-to-year focus.

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Who pays taxes in a corperation?
atroni [7]

Answer:

<em>Companies, both private and public which are registered in India under the Companies Act 1956, are liable to pay corporate tax. For the assessment year 2014-15, domestic companies are taxed at the rate of 30%.</em>

Explanation:

<h3><em>I </em><em>hope</em><em> this</em><em> helps</em><em>!</em></h3>
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