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grigory [225]
3 years ago
6

Dean Brothers Inc. recently reported net income of $1,500,000. The company has 300,000 shares of common stock. The stock current

ly trades at $60 a share. The company continues to expand and anticipates that one year from now its net income will be $2,500,000. Over the next year the company also anticipates issuing an additional 100,000 shares of stock, so that one year from now the company will have 400,000 shares of common stock. Assuming the company's price/earnings ratio remains at its current level, what will be the company's stock price one year from now?
Business
1 answer:
vladimir1956 [14]3 years ago
7 0

Answer:

$75

Explanation:

The formula to compute the price -earning ratio is shown below:

Price earning ratio = Market price ÷ Earning per share

where,

Market price is $60

And the earning per share is

= ($1,500,000 ÷ 300,000 shares)

So, price earning ratio is 12

Now the company stock price is

$12 = Stock price ÷ (2,500,000 ÷ 400,000)

So, Stock price is $75

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The payback period of the project is 3.3 years.

Payback period = initial investment/ annual cash flow

= 50,000/15,000

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The time period payback period refers to the amount of time it takes to get better the fee of an funding. surely put, it's miles the period of time an investment reaches a breakeven point. human beings and groups in particular invest their money to receives a commission again, which is why the payback length is so vital.

Payback period in capital budgeting refers back to the time required to recoup the budget expended in an funding, or to attain the ruin-even factor. for example, a $a thousand funding made at the start of 12 months 1 which again $500 at the quit of year 1 and year 2 respectively could have a two-year payback duration.

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5 0
1 year ago
The produces computers and sells them to . At the same time produces cars and sells them to the . Suppose there is an appreciati
Elanso [62]

Correct/Complete Question:

The United States produces computers and sells them to Russia. At the same time, Russia produces cars and sells them to the United States. Suppose there is an appreciation in the dollar. This will​ cause:

Answer:

increase in imports into the United States and decrease in exports to Russia​ will occur, which will cause a decrease in aggregate demand and real GDP

Explanation:

Aggregate demand is the total demand for a good or service in an economy at a given time. Real GDP on the other hand can be defined as an inflated value of goods and services in an economy at a certain period of time. An inflation of the dollar will increase imports into the united states as it would decrease the exports to Russia. This because the appreciation of the dollar will affect the prices of both computers and cars. And as such will

6 0
3 years ago
Lopez Plastics Co. (LPC) issued callable bonds on January 1, 2021. LPC's accountant has projected the following amortization sch
Kobotan [32]

Answer:

c. 7%

Explanation:

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shtirl [24]

Answer:

B is the correct option.

Explanation:

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3 years ago
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pishuonlain [190]

This isn't really a business question, but generally vegetables would be a healthier choice for a pizza topping instead of meats and cheeses.

7 0
3 years ago
Read 2 more answers
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