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Tresset [83]
2 years ago
8

Storico Co. just paid a dividend of $3.15 per share. The company will increase its dividend by 20 percent next year and then red

uce its dividend growth rate by 5 percentage points per year until it reaches the industry average of 5 percent dividend growth, after which the company will keep a constant growth rate forever. If the required return on the company’s stock is 12 percent, what will a share of stock sell for today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Business
1 answer:
ololo11 [35]2 years ago
5 0

Answer:

The price of the stock today or the price at which the stock should sell today is $61.30

Explanation:

The price of the stock today can be calculated using the Dividend Discount Model approach which values a stock based on the present value of the expected future dividends from the stock. The price of this stock will be,

P0 = 3.15 * (1+0.2) / (1+0.12)  +  3.15  * (1+0.2) * (1+0.15)  /  (1+0.12)^2  +  

3.15 * (1+0.2) * (1+0.15) * (1+0.1) / (1+0.12)^3  +  

[(3.15 * (1+0.2) * (1+0.15) * (1+0.1) * (1+0.05) / (0.12 - 0.05))  / (1+0.12)^3]

P0 = $61.296 rounded off to $61.30

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Anastasy [175]

Answer:

cash                       19,300,000 debit

      unearned revenues                 19,300,000 credit

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balance:

19,300,000 - 12,700,000 = 6,600,000 balance

Explanation:

the gift card will be considered a liaiblity as it generates an obligation to Apple to latter provide their services/goods.

Once the gift card are redeem the company is able to recognize revenue as it has provided the goods to the customers.

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2 years ago
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Nat2105 [25]

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Explanation:

8 0
3 years ago
Say that Alland can produce 32 units of food per person per year or 16 units of clothing per person per year, but Georgeland can
bixtya [17]

Answer:

Georgeland has an absolute but not a comparative advantage in producing clothing.

Explanation:

Absolute advantage is defined as the ability of a firm to produce higher amounts of a product as a result of use of the same resources with other competitors. It is usually bad a result of more efficient production process.

Comparative advantage is the ability of a firm to produce goods at a lower opportunity cost. Therefore they are able to sell at lower price compared to competitors.

Georgeland can produce 18 units of clothe per year while Alland can produce 16 units per year, so Georgeland has absolute advantage.

In producing clothes Georgeland has opportunity cost of 36 units of food which is higher than that of Alland which is 32 units of food. So Georgeland does not have comparative advantage in producing clothes.

3 0
2 years ago
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gayaneshka [121]

Answer:

Letter C is correct. <em>A firm that relies on high output controls to tap into intrinsic motivation.</em>

Explanation:

By carefully selecting the employees of his consulting firm, Mona ensures that each employee's expected competency and skills profile has been met through rigorous selection, which enhances the chances that operational strategies will be more widely deployed and accepted effective.

By setting the expected results, but letting the employees themselves define how to achieve them, it generates an intrinsic motivation, one that generates internal feelings in the individual to want to achieve personal goals, objectives and projects that motivate and stimulate them.

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Explanation:

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