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skad [1K]
3 years ago
14

Hot Wings, Inc., has an odd dividend policy. The company has just paid a dividend of $5.85 per share and has announced that it w

ill increase the dividend by $10.75 per share for each of the next four years, and then never pay another dividend. If you require a return of 12 percent on the company’s stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Current share price $
Business
2 answers:
GalinKa [24]3 years ago
6 0

Answer:

The present intrinsic value of the share is 94.79 dollars

Explanation:

We need to discount the future dividends at the required rate of return

\left[\begin{array}{ccc}Year&Cashflow&Discounted\\0&5.85&\\1&16.6&14.82\\2&27.35&21.8\\3&38.1&27.12\\4&48.85&31.05\\TOTAL&&94.79\\\end{array}\right]

Each year is discount according to the lump sum formula

\frac{cashflow}{(1 + rate)^{time} } = PV

being rate 12% --> 0.12

\frac{16.6}{(1 + 0.12)^{1} } = 14.82

\frac{27.35}{(1 + 0.12)^{2} } = 21.8

and so on

Elodia [21]3 years ago
4 0

Answer: $94.79

Explanation:

Given the following ;

Current dividend = $5.85 per share

Yearly increment in dividend = $10.75 per share

Number of years = 4

Time (t) = 1-4

Internal rate of return = 12%

Calculate the present value of share given the above details

Cashflow over four years

Year1 = $5.85 + $10.75 =$16. 60

Year2 = $16.60 + $10.75 = $27.35

Year3 = $27.35 + $10.75 = $38.10

Year 4 = $38.10 + $10.75 = $48.85

Present value (PV) =

Cashflow÷(1+IRR) + cashflow÷(1+IRR)^t + cashflow÷(1+IRR)^t + cashflow÷(1+IRR)^t

Present value (PV) =

Year1÷(1+IRR) + year2÷(1+IRR)^2 + Year3÷(1+IRR)^3 + Year4÷(1+IRR)^4

PV = $16.60/(1.12) + ($27.35)/(1.12)^2+ $38.10/(1.12)^3 + $48.85/(1.12)^4 = $94.79

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Answer:

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Explanation:

Giving the following information:

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Answer:

B) There has been economic growth in our society.

Explanation:

The American economy has consistently been the largest economy in the world since 1871, while the rest of the economic podium has changed a lot. Currently the Chinese economy is number 2, but just a few years ago the Japanese economy was on second place. The United Kingdom is currently a large economy, but it was number 1 before the US, and then it continued to fall to the sixth place. Argentina was once of the largest economies and richest economies in the world, and now it is a developing nation.

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Answer:

Prerequisite 1  

There are three nonexclusive serious techniques:  

Cost Leadership - target showcase exceptionally broad, point is to have the most minimal cost. Items not specific, attempt to speak to shoppers because of their low costs.  

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Prerequisite 2  

Basic Success Factors are the vital money related and non-monetary proportions of achievement. To be increasingly explicit Critical Success Factors are features of the association's exhibition that are essential to its upper hand.  

The Cappuccino Express Critical Success Factors :  

Quality and cost of existing items  

Areas specific..near Malls , schools , workplaces and so forth.  

Devise new items at customary interims  

Client Turnover – capacity to keep lines short, vehicles traveling through line  

Keeping Loyal clients with quality items along these lines diminishing ad costs  

Giving incredible client support  

Improving Profitability  

The greater part of these Vincent will have the option to show some power about whether it is adjusting costs, items, guiding various areas or making preparing programs. Then again, if Vincent's essential supposition never again remains constant, regardless of what he does he will most likely be unable to equal the initial investment, not to mention turn a benefit.  

Prerequisite 2  

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The manager directs the team's objectives when practicing directional leadership. Senior management can, for instance, offer coaching, define roles, remove barriers, and offer appreciation as necessary.

It's crucial to have leadership in your organization if you want to boost productivity and reach your objectives. Effective leaders make their objectives clear, inspire and direct their followers toward the organization's mission.

The query is unfinished. Please read on to learn more lacking information.

Click here to learn more about leading by example: brainly.com/question/25927714

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