The current price of the stock is $68.04. The most recent price at which a security was sold on an exchange is the current price.
<h3>Does the market price match the present pricing?</h3>
Both buyers and sellers use the current price as a benchmark. The asking price is a good reflection of current worth, but depending on supply and demand, the actual selling price could be greater or lower.
The current price, often known as the "market price," is the cost that was most recently exchanged for a share or unit of security, coin, good, or precious metal that is traded on an exchange. The market capitalization, or "market cap," of a firm is calculated using the market price per share.
Given:
Current Price = D1/(ke - g)
D1 = 3.10 × (1 + .0425)
ke = 9%
g = 4.25%
Current price = 3.10 × (1+.0425)/(9% - 4.25%) = $68.04
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Answer:
D) joint venture
Explanation:
A joint venture refers to a situation where two companies will join together to form a third independent entity that operates in a specific market or develops specific products. The companies only work together to form the joint venture, but the rest of their operations remain separate from each other.
By forming a joint venture, both companies can utilize resources more efficiently while remaining separate in other markets.
Answer:
The correct answer is letter "D": and saving would decrease.
Explanation:
Increases in interest rates are not beneficial for economic growth. <em>By paying more taxes companies' revenues are reduced discouraging entrepreneurs to go on new ventures</em>. Besides, entities would be pushed to take measures such as lay-offs to compensate part of the losses due to paying more taxes. <em>If unemployment increases the household savings tend to decrease.</em>
Answer:
The Required rate of return on Portfolio is 9.67%
Explanation:
In order to get the answer first we need to calculate the new beta of portfolio. The weight of portfolio and new stock is calculated using total value of investment in portfolio and multiplying by the total investment we get new beta.
(3M / 3.6M) x 1.10 + (0.6M / 3.6M) x 0.60 = 1.01667
Through using the CAPM Model we get risk premium of Existing Portfolio:
Required rate of return of portfolio = RF + ( Rm - RF ) x beta
10% = 5.6% + (Rm -RF) x 1.10
10% - 5.6% = (Rm - RF) x 1.10
4.4% / 1.10 = (Rm - RF)
(Rm - RF) = 4%
After getting the Risk Premium we can CAPM model equation to get New Required rate of return.
Required rate of return of portfolio = RF + ( Rm - RF ) x beta
Required rate of return of portfolio = 5.6% + 4% x 1.01667
Required Rate of Return of Portfolio = 9.67%
Answer:
Computation of cash received from the sale of the equipment:
D. $58,000.
Explanation:
Computation:
Sale of Equipment Account
Equipment account $240,000
less acc. depreciation 172,000
Net book value $68,000
less loss on sale 10,000
Cash received $58,000
Equipment Account
Year 1 balance $750,000
Year 2 balance 510,000
Sale of equipment $240,000
Accumulated Depreciation:
Year 1 balance $500,000
Year 2 balance 328,000
Sale of equipment $172,000
b) The sale of the equipment caused a loss of $10,000. The net book value of the equipment is $68,000. This implies that it was sold for $58,000 ($68,000 - $10,000). So, the cash received from the sale is $58,000.
