Answer:
This question is incomplete. However, I found the full question with choices from the web ;
Which of the following describes the results of an increase in supply on price and quantity in the market?
a.) Both price and quantity increase
b.) Both price and quantity decrease
c.) Price increases and quantity decreases
d.) Price decreases and quantity increases
e.) Insufficient information
Explanation:
If the supply of a product or service increases in the market, it means that there will be an increase in the quantity of that product/service. Due to the interplay of the law of demand and supply, competition among suppliers will increase, driving the price down. Therefore, there will be a fall the equilibrium price and increase in quantity , making choice D correct.
Answer:
The value of this stock today should be $6.22
Explanation:
The company will start paying dividends 2 years from today that is at t=2. The dividends received 2 years from today can be denoted as D2. The constant growth model of DDM will be used to calculate the price of this stock at t=2 as the growth rate in dividends is constant forever.
The price at t=2 will then be discounted back to its present value today to calculate the price of this stock today.
The price of this stock at t=2 will be,
P2 = D2 * (1+g) / (r - g)
P2 = 0.6 * (1+0.04) / (0.12 - 0.04)
P2 = $7.8
The value of this stock today should be,
P0 = 7.8 / (1+0.12)^2
P0 = $6.218 ROUNDED OFF TO $6.22
Answer:
$1,035,459.51
Explanation:
First we must determine the issuing value:
- cash flow 1 = $60,000
- cash flow 1 = $60,000
- cash flow 1 = $60,000
- cash flow 1 = $60,000
- cash flow 1 = $1,060,000
using an excel spreadsheet to calculate the bond's price with a discount value of 5%:
the bonds were sold at $1,043,294.77
the effective interest expense = bond's price x market interest = $1,043,294.77 x 5% = $52,164.74
bond's value = bond's price - (coupon payment - effective interest) = $1,043,294.77 - ($60,000 - $52,164.74) = $1,035,459.51
I think the answer is C but i could be wrong