Consumers would most likely treat candy bars as ___

The Isberg Company just paid a dividend of $0.75 per share, and that dividend is expected to grow at a constant rate of 5.50% pe

Ugo [173]

Answer:

d) $18.62

Explanation:

Hi, first, let´s introduce the formula to find the price of this stock.

$Price=\frac{D_{0} (1+g)}{(r-g)}$

Where:

Do = Last Dividend

g = growth rate

r = cost of equity

We have almost everything, all we need to do is find "r". That is:

$r=rf+beta*MRP$

Where:

rf = risk Free rate

MRP = market risk premium.

So, we find r first as follows:

$r=0.04+1.15*0.05=0.0975$

therefore, r = 9.75%. Now we are ready to find the price of the stock.

$Price=\frac{0.75*(1+0.055)}{0.0975-0.055} =18.62$

The price of this stock is $18.62

Best of luck.

3 0

4 years ago

A monopolist has four distinct groups of customers. Group A has an elasticity of demand of 0.2, B has an elasticity of demand o

Bumek [7]

Answer: Group A

Explanation:

Price Elasticity of demand refers to the sensitivity of quantity demanded given a change in price. In other words, how much will quantity demanded change if price changes. Higher elastcities mean that when prices change, their quantity demanded changes more. For instance, an elasticity of demand of 2 means that when prices rise by 2%, demand will decrease by 4%.

The group that will be paying the most therefore will have to be the group that is least sensitive to paying that high price. That would be Group A. As they are not very sensitive to price changes with an elasticity of 0.2, the Monopoly can increase their price to a higher point than others knowing that they won't demand less goods.

5 0

3 years ago

If the world price for good A is above the domestic price for good A without trade, then producer surplus will ________ and tota

goblinko [34]

Answer:

The correct answer is letter "B": increase; decrease.

Explanation:

Producer surplus is the difference between the price at which the manufacturer actually sells a product and the minimum price the manufacturer would have accepted. The surplus results from the producer being able to sell their goods at a market price higher than their minimum price.

So, if producer A manufactures a product that is being sold at a higher price level abroad, its producer surplus will increase. However, the overall economic surplus with trade will decrease since the introduction to producer A to the market will allow consumers to purchase the goods at a lower price.

6 0

3 years ago

Walden’s family is shopping for a reclining chair. The chair the family decided on has a retail price of $800 plus 5% sales tax

IceJOKER [234]

Just by looking at the answer you can take out D because C already offers no tax and 5% off, do C is better than D, so we only have to do t math for A, B, and CA is 800 plus tax, with $75 back800×1.05 (because it's 5% tax) -75 =$765B is 800×.90 (because 10% off means he's paying 90%)×.05=$756C is 800×.95 (because 5% off means he's paying 95%) =760A=765B=756C=760So B is the best deal

:)

6 0

3 years ago

Read 2 more answers

In her report about electric cars, Lavonda wants to use information to substantiate her theory that they are helping the environ

slega [8]

Elon musks annual report. It makes the most sense.

3 0

3 years ago

Consumers would most likely treat candy bars as ____ products.