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elena-s [515]
3 years ago
14

Universal Exports is expected to pay the following dividends over the next four years: $8, $4, $2, and $2. Afterwards the compan

y is not expected to pay anything ever again. If the required return is 15 percent, what is the maximum that you would be willing to pay for a stock of Universal today
Business
1 answer:
tester [92]3 years ago
4 0

Answer:

Maximum price to be paid for the stock = $12.43

Explanation:

The Dividend Valuation Model is a technique used to value the worth of an asset. According to this model, the worth of an asset is the sum of the present values of its future cash flows discounted at the required rate of return.

<em>Hence the value of the stock would be the present value of its future dividend discounted at 15%</em>

Year                                   PV of dividend

1                                          8  ×1.15^(-1)  

2                                           4 ×  1.15^(-2)  

3.                                              2 × 1.15^(-3)    

4                                                  2 × 1.15^(-4)    

PV of dividend =   (8 ×1.15^-1) +  (4 × 1.15^-2)  + (2 × 1.15^ -3) + (2× 1.15^-4) = 12.439

Maximum price to be paid for the stock = $12.43

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Answer:

Non-compete clause

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The physician has asked the medical assistant to provide patient education for hypertension. What is the best way to provide thi
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Suppose the Fed carries out an open market sale of $100m and simultaneously decreases the minimum required reserve ratio from 10
andrey2020 [161]

Answer:

loanable amount after Fed operation = $950 M

Securities after fed operation = $50 M

attached below is the T-account table

Explanation:

Given data:

For assets : securities = $100 M ,  Loans = $800 M

For Liabilities :  Constant demand deposit = $1000 M

difference between the assets and liability = $100 M  and this makes the Banking system unbalanced hence the Banking system needs the intervention of the Fed. and the reduction in the required reserve ratio from 10% to 5% is the right action

How with the reserve ratio reduced to: 0.05

hence required  Minimum required securities after operation = 0.05 * 1000 M = 50 M

Note : Total demand deposits = securities + loanable amount

therefore loanable amount after Fed operation = $1000 M - $50 M = $950

Attached below is the T-table

When both tables are compared it can be seen that there is a significant increase  in the loanable amount after the Fed's operations and increase in Loanable amount transcends to increase in Monetary base

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Bao has been notified by his electric company that his rates are going up on his graduated fee schedule. He currently pays?
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Bao has been notified by his electric company that his rates are going up on his graduate fee schedule. he currently pays $81.

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The Bao ('bun') developed in Chinese language subculture as a filled form of 'Mantou,' a plain steamed dumpling that is frequently compared to bread. The story in the back of this steamed pride explains not just its particular form, but purchase why its improvement into Baos (or ) was the sort of herbal one.

Bánh bao (literally "dumplings") is a Vietnamese bun primarily based on the Cantonese da bar added to Vietnam through Cantonese immigrants. it is a ball-formed bun containing red meat or fowl meat, onions, eggs, mushrooms, and greens, in Vietnamese delicacies.

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