Answer:
current share price = $85.96
Explanation:
Find the PV of each dividend
PV= FV / (1+r)^t
r= required return
t= total duration
PV(D1) = 18 / (1.14)= 15.78947
PV(D2) = 14 / (1.14^2) = 10.77255
PV(D3) = 13 / (1.14^3) = 8.774630
PV(D4) = 7.50 / (1.14^4) = 4.44060
PV(D5 onwards) is a two-step process, first PV of growing perpetuity;
PV(D5 onwards) at yr4 =[7.50*(1+0.04) ] / (0.14-0.04) = 78
second, finding PV today ; PV(D5 onwards) at yr 0 = 78 / (1.14^4) = 46.18226
Add the PVs to get the current share price = $85.96
The statement is false. It would be an advantage to both the client and the organization. This would mean if the client needs a markdown from the provider they would need to pay the receipt inside 10 days to get the rebate, and this would then enable the organization to get their cash speedier.
First, we take into account the benefit and cost given in the problem. The benefit, which is $2 is a dollar lesser compared to the cost that would be incurred should the business opt to produce one more roast beef. This, of course, tells us that an additional roast beef will just impose an additional $1 cost. Thus, the answer should be the last choice.
Investment banks help companies to purchase, sell and make investments using bonds while commercial banks are concerned on managing deposits on both savings and checking account.
Investment banks aid companies on bringing their investments on public offers; commercial banks are focused on providing security for the clienteles money.
Investment banks have some degree of freedom in choosing their own strategies while commercial banks have more risks because they are open to public transactions.
Answer: A cash sale
Explanation: In simple words, liquidity refers to the ability of an organisation to bear its short term expenses. For that a company must have cash or some assets that can be readily converted into cash in case of need.
Hence Sally should sell her company in cash sale as it will result in inflow of cash which will create liquidity and also the consideration will be certain with short timely payments.
Other option such as IPO or stock for stock might result in increase in value but certainly won't give her liquidity.
