A comparison between two or more similar events or things is called

Red, Inc., Yellow Corp., and Blue Company each will pay a dividend of $3.65 next year. The growth rate in dividends for all thre

Natali5045456 [20]

The value of each company's shares of stock

Red: $91.25

Yellow:$52.14

Blue: $36.50

Step 1

The constant dividend growth model, which is written as

Pt = Dt (1 + g)/(R - g)

Therefore, the current stock price for each company is:

Price of the red stock is $3.65/(0.08 -0.04) = $91.25.

Price of the yellow stock is $3.65/(0.11 -0.04) = $52.14.

Price of the blue stock is $3.65/(0.14 -0.04) = 36.50.

The stock price falls as the needed return rises. A greater discount rate reduces the present value of cash flows, which is a function of the time value of money. The stock price can be significantly affected by even slight changes in the needed return, which is another crucial point to remember.

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3 0

2 years ago

Determine which of the statements are examples of market transactions and which are not. Identify statements describing market t

tangare [24]

Answer:

Market transactions are those in which the buyer and seller act in their own self interest.

In not market transaction they are not performed at an arms length and buyer and seller of services do not act on their self interest.

1. Frank takes care of his elderly aunt while she recovers from knee replacement surgery. (not market)

Reason: Non marketed transactions are not at arm's length and not in the self interest of the buyer and seller combine.

2. Jack and Diane buy tickets to the sold out Pirates game from a ticket scalper. (not market)

Reason: The transaction is in the self interest of both buyer and seller but it is an illegal transaction done by ticket scalper to take advantage of the old out factor of the show.

4. The citizens of Marble Cliff, Vermont, get financial relief from the government after a flood destroyed all of their homes. (not market)

Reason: The loss compensation by the government is an intervention in the market to help citizens and not an arms length transaction between buyer and seller.

5. Suzanne gets a used textbook on eBay for much less than its list price at her university's bookstore.(market)

Reason: Ebay is a platform that provides services to connect buyer and seller to sell goods. The transaction is in the self interest of both buyer and seller

6. Norm paints the fence in his front yard on his day off work.(not market)

Reason: non marketed services are not part of the market transactions.

7.Mitchell buys 50 shares of General Motors stock at the going price per share (market)

Reason: Going price is the current market price of the transaction hence it is performed at an arms length in both the interest of the buyer and seller.

6 0

4 years ago

The commission structure on a stock purchase is $45 plus $0.04 per share. If you purchase five round lots of a stock selling for

Vedmedyk [2.9K]

The commission for purchasing five round lots of a stock selling for $130 is $65.

<h3>What is round lots of a stock?</h3>

A specified quantity of securities to be traded on an exchange is known as a round lot. In the stock market, a round lot is defined as 100 shares or a bigger number that may be divided in half equally.

1 round lots = 100 shares

5 round lots = 500 shares

The commission structure on a stock purchase is $45 plus $0.04 per share.

For 500 shares, the commission is

= 45 + 0.04×500

= 65

Therefore, the commission for purchasing 500 shares of stock selling for $130 is $65.

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7 0

2 years ago

A not-for-profit (NFP) organization acting as a financial intermediary receives a contribution. Under the FASB Codificationthe N

IrinaK [193]

Answer:

B. The NFP is acting as an agent, receiving the contribution on behalf of another organization.

Explanation:

When the Not for profit organization acts as an intermediary then it would record the contribution it received from some organisation towards some different third organisation.

As the amount does not belong to Not for Profit organisation, and then it needs to further pay such amount to different party or organisation to which it belongs, and on behalf of which the Not for Profit organisation collected such amount.

4 0

3 years ago

During lunch, the director of the Streets and Parkways Department of City made the following comment: “For the past 10 years, I

Usimov [2.4K]

The behavior is unethical as the overstatement in the figures is wrong.

<h3>What is an ethical behavior?</h3>

Honesty, fairness, and equity in interpersonal, professional, and academic relationships, as well as research and scholarly activities, are characteristics of ethical behavior. Individuals and groups of people's dignity, diversity, and rights are all respected in ethical behavior.

Obedience to company rules, effective communication, taking responsibility, accountability, professionalism, trust, and mutual respect for coworkers.

In this case, for the past 10 years, the director deliberately overstated the labor and equipment needs by 20 percent when preparing the budget request. This is unethical.

In order to cut down the padding, there should be a final review on the budget before it's submitted for approval.

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6 0

1 year ago