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Eva8 [605]
3 years ago
6

Computech Corporation is expanding rapidly and currently needs to retain all of its earnings; hence, it does not pay dividends.

However, investors expect Computech to begin paying dividends, beginning with a dividend of $0.75 coming 3 years from today. The dividend should grow rapidly-at a rate of 16% per year-during Years 4 and 5; but after Year 5, growth should be a constant 8% per year. If the required return on Computech is 14%, what is the value of the stock today? Round your answer to the nearest cent. Do not round your intermediate calculations.
Business
1 answer:
sweet [91]3 years ago
5 0

Answer:

The intrinsic value of the stock is 9.76

Explanation:

We have to use the dividend growth model

It is fundamental to understand that these values are in the future so we must take them to present value, using the required return of 14%

\left[\begin{array}{ccc}-&DIVIDENDS&PRESENT VALUE\\1&0&0\\2&0&0\\3&0.75&0.506228637151512\\4&0.87&0.515109841312065\\5&1.0092&8.73578093453209\\Intrinsic&Value&9.75711941299567\\\end{array}\right]

We multiply year 3 by 1.16 to get year 4

Then we multiply year 4 by 1.16 to get year 5 dividends.

Then we use the dividend growth model to get the value ofthe future years

\frac{dividends}{return-growth} = intrinsic \: value

Again, this value is set 5 years into the future, so we have to calculate the present value

\frac{intrinsic \: value}{1.14^{5} } = Present Value

Same process is done for year 3 and 4

\frac{.75}{1.14^{3} } = PV \: Year3

\frac{.87}{1.14^{4} } = PV \: Year4

Then we add the three values to get the value of the stock today.

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In order to help their employees move from one job to another, and in order to meet the challenges of a global economy, corporations must offer retraining program as part of their employee development programs.

To meet the challenges of a global economy and to help employees move from one job to another corporations must offer retraining as part of employee development programs. Training and development is considered vital because it allows employers to pinpoint skills and knowledge they want in their employees. These trainings not only educate the employees but also provide updates on existing skills to increase productivity. Every business has different needs to retain their employees to meet their internal and external challenges.

These trainings to retain the employees are proved to be fruitful

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6 0
1 year ago
Maintenance, which was about 18 of the total budget less than it spent on administrative personnel. The amount spent on administ
____ [38]

Answer:

the remaining budget for other expenses = 1/8 of the total budget

Explanation:

Since the city's administrative personnel expenses are 1/8 larger than both maintenance expenses and safety expenses, it means that safety expenses are equal to maintenance expenses.

Since maintenance expenses are 1/4 of the total budget, safety expenses are also 1/4 of the total budget.

Administrative personnel expenses are 1/8 higher, so that means that they equal 1/4 + 1/8 of the total expenses.

If we add the three categories = 1/4 + 1/4 + (1/4 + 1/8) = 7/8

So the remaining budget for other expenses = 1 - 7/8 = 1/8 of the total budget

8 0
3 years ago
The perfectly competitive firm's short-run supply curve is the Group of answer choices upward-sloping portion of its average tot
allochka39001 [22]

Answer:

Portion of its marginal cost curve that lies above its average variable cost curve.

Explanation:

This is explained to be the portion of its marginal cost curve because marginal gross benefits exceeds marginal cost, the firm can earn greater profits by increasing its output.

These profits are been maximized by choosing to supply the level of output where its marginal revenue equals its marginal cost. When this revenue is below the said marginal cost, money is lost, and consequently, it must reduce its output. Profits are however utilized when the firm chooses the level of output where its marginal revenue equals its marginal cost.

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4 years ago
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harkovskaia [24]

Answer:

\boxed{\bold{Automobile \ Engines}}

Explanation:

➤ Automobile engines would be most likely to have dependent demand

When creating a new car, customers are going to want an engine in their car. That is why it is a "department demand." It is a demand that an automobile must have an engine when you are creating / working in the automobile department. You can't build an automobile without an engine, and that is why it is a demand to have one.

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4 years ago
What are the six segments of the travel industry? Give examples of each. <br> Actual examples please
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Like cars, bikes, airplanes, trains, public transport?
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