Answer:
The price of one share of such a stock today is $49.86
Explanation:
The stock's price today under the Dividend discount model can be calculated by discounting the expected future dividends to the present value using an appropriate discount rate. When the dividend growth becomes constant, we calculate the terminal value and discount it back too. The appropriate discount rate is the required rate of return. The worth of one of such stock today is,
V0 = 2.5 / (1+0.12) + 3.5 / (1+0.12)^2 + 4.5 / (1+0.12)^3 +
[4.5 * (1+0.04) / (0.12 - 0.04)] / (1+0.12)^3
V0 = $49.86
No, its okay not to use all that extra stuff, so F
Answer:
the contribution margin per unit for part A is $1,479,000
Explanation:
The computation of the contribution margin for part A is shown below:
Contribution margin per unit is
= $950 - $600 - $95
= $255
Now for contribution margin per unit for part A is
= 5,800 units × $255
= $1,479,000
Hence, the contribution margin per unit for part A is $1,479,000