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Zanzabum
3 years ago
7

Longs Drug, a large U.S. drugstore chain operating primarily in Northern California, had sales per share of $122 in 1993, on whi

ch it reported earnings per share of $2.45 and paid a dividend per share of $1.12. The company is expected to grow 6% in the long term, and has a beta of 0.90. The current T.Bond rate is 7%. Estimate the appropriate price/sales multiple for Longs Drug. The stock is currently trading for $34 per share. Assuming the growth rate is estimated correctly, what would the profit margin need to be to justify this price per share.?
Business
1 answer:
Vika [28.1K]3 years ago
8 0

Answer:asdfghjkllkjhgfdsasdfghjk

Explanation:

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Laura is a gourmet chef who runs a small catering business in a competitive industry. Laura specializes in making wedding cakes.
Tanya [424]

Answer:

The correct answer is option a.

Explanation:

The monthly total revenue is $5,000.

The marginal cost of producing 19th, 20th and 21st unit is $200.

Laura will earn profit if the price is able to cover marginal cost.

Total revenue is the product of price and quantity.

Price of cake when Laura produces 19 units

= \frac{TR}{Q}

= \frac{5,000}{19}

= $263.15

Price of cake when Laura produces 20 units

= \frac{TR}{Q}

= \frac{5,000}{20}

= $250

Price of cake when Laura produces 21 units

= \frac{TR}{Q}

= \frac{5,000}{19}

= $238.09

So we see that the price is able to cover marginal cost till 21st units, so Laura should produce more than 20 units and go on producing till price becomes equal to marginal cost.

4 0
3 years ago
Explain with examples, the process of screening and evaluating new venture opportunities.
Blababa [14]
Self-Analysis
According to the Arkansas Small Business Development Center, most small businesses fail because of poor management and the owner’s inability to manage resources. Before you even start researching the feasibility of your idea and the market you plan on entering, evaluate your own talents, desires and goals. Consider your willingness to take risks as well as the amount of time and energy you’ll need to make the business a success. Review your financial, personnel and marketing skills as well to ensure you have the necessary background to make a success of your new venture.

Financial Components
After learning about the investment required to purchase the existing business or franchise or the start-up costs you’ll need initially, evaluate your own resources. Part of a financial assessment includes the amount you have in personal savings to add to the initial investment. Banks typically require entrepreneurs to come up with a portion of the investment to show good faith and willingness to take a risk with the lender. Assess the financing available through the seller, investors and lenders when evaluating your chances of succeeding.

Market Research
To thoroughly understand what you’re getting into, perform an extensive market research project to determine the feasibility of your business. In addition to gleaning statistics of trends and current customer buying patterns, you need to know who your customers are, where they are located and what kind of competition exists in your area. Consider market research your first steps in opportunity analysis that help you understand exactly how you will sell products or services to a specific market.

Support
Finally, evaluate the amount of support you expect to receive from your family and the community.
4 0
2 years ago
Julio is devising a marketing plan for introducing his company's products into a new market. julio comes up with customized mark
marissa [1.9K]

Julio is devising a marketing plan for introducing his company's products into a new market. Julio comes up with customized marketing strategies that cater to the unique needs of the new market. all his decisions involve risk and uncertainty as he is unaware of the conditions in the new market. The type of decision being made by Julio in the above situation is called a non-programmed decision. Non-programmed decision deals with risk and uncertainty. It is also complex and unstructured.

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5 0
2 years ago
Levi's Levees always evaluates projects using the payback method. What is the payback period for the following set of cash flows
Ray Of Light [21]

Answer:

3.14 years

Explanation:

Year              Cash flow                Accumulated cash flows

0                    -$4,900                            -$4,900

1                       $1,150                             -$3,750

2                      $1,350                            -$2,400  

3                     $2,230                                -$170

4                     $1,250                              $1,080

3 years + $170/$1,250 = 3.14

The payback period is 3.14 years, or 3 years, 1 month and 19 days.

7 0
2 years ago
Marie is putting together a retirement plan and is scheduled to retire in 40 years. She is planning to open a retirement account
kap26 [50]

Answer:

R=407.11$

Explanation:

Since the Marie wants to contribute equal amount per month in order to get the $3,000,000 after 40 years, therefore the future value of annuity formula shall be applied to the given question to solve the problem.

Future value of annuity=R[((1+i)^n-1)/i]

R=monthly investment to be made=?

n=number of payments involved=40*12=480

i= interest rate=10.5%/12=0.875%

Future value of annuity=$3,000,000

$3,000,000=R[((1+0.875%)^480-1)/0.875%]

R=407.11$

6 0
3 years ago
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