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marysya [2.9K]
3 years ago
5

The price of NetFlex stock is $54.54; its expected dividend next year is $6, and its constant annual growth rate thereafter is 5

%. What is the required rate of return on the stock
Business
1 answer:
katrin [286]3 years ago
5 0

Answer:

Rate of return is 16.11%

Explanation:

Dividend Valuation method is used to value the stock price of a company based on the dividend paid, its growth rate and rate of return. The price is calculated by calculating present value of future dividend payment.

Formula to calculate the value of stock

Price = Dividend / ( Rate or return - growth rate )

$54 = $6 / ( Rate or return - 5% )

Rate or return - 0.05 = $6 / $54

Rate or return - 0.05 = 0.1111

Rate or return = 0.05 + 0.1111

Rate or return = 01611

Rate or return = 16.11%

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Internal growth.

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Internal growth strategy is one that uses internal resources to develop a company internally. It focuses on increasing efficiency, hiring the right people, new product development, and better marketing.

Internal growth is also known as organic or natural growth. Growth results in increased profit which is now reinvested in the business.

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3 years ago
Does audit service needed in Auchi polytechnic student union government of yes why
ladessa [460]

Yes audit service is needed in the Union government of this school called Auchi polytechnic.

<h3>What is audit?</h3>

This is the term that is used to refer to the official inspection that is done into the accounts of an organization of which this Union can be grouped under.

It helps to verify and also check the financial information of the entity. The reason why the audit is needed is because it would help to expose issues that may have to do with misappropriation of funds by the union.

It would also helps to tell the school if the financial report that the union makes is the same as the financial reflection of the Union at a particular point in time.

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7 0
2 years ago
Calculate the growth rate of the company's EBIT from 2005 to 2006:2005:Sales:15,000,000COGS:12,000,000SG&amp;A:500,000Interest E
Y_Kistochka [10]

Answer:

B) 20.0%

Explanation:

2005:

Sales:                    15,000,000

COGS:                  (12,000,000)

SG&A:                   <u>(500,000)</u>

EBIT                      2,500,000

2006:

Sales:                    20,000,000

COGS:                  (16,000,000)

SG&A:                  <u>(1,000,0000) </u>

EBIT                      3,000,000

Growth rate = ((3,000,000 - 2,500,000) / 2,500,000 ) x 100 = (500,000 / 2,500,000 ) x 100 = 20%

3 0
3 years ago
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