You are to write a main() program in c++ implementing the test cases that were created for task 1. Your main() program will use
1 answer:
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Answer:
50
Explanation:
According to the question, The computation of the quantity produce is shown below:
Here we use the differentiation LRAC to zero
From above calculation it can be concluded that the each firm would be produced the quantity of long run equilibrium for 50
Hence, the first option is correct
Answer:
Explanation:
From the given information:
The current price =
2. The value of the stock
Calculate the earnings at the end of 5 years:
Terminal value year 5 =
=$75.526
Discount all potential future cash flows as follows to determine the stock's value:
=$ 54.1945
As a result, the analysts value the stock at $54.20, which is below their own estimates.
3. The value of the stock
Calculate the earnings at the end of 5 years:
Terminal value year 5 =
=$53.8773
Discount all potential cash flows as follows to determine the stock's value:
=$39.460
As a result, the price is $39.460, and the other strategy would raise the value of the shareholders. Not this one, since paying a 100% dividend would result in a price of $54.20, which is higher than the current price.
Notice that the third question depicts the situation after 5 years, but the final decision will be the same since we are discounting in current terms. If compounding is used, the future value over 5 years is just the same as the first choice, which is the better option.
The presumption in the second portion is that after 5 years, the steady growth rate would be the same as measured in the first part (1).