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A company recently paid out a $4 per share dividend on their stock. Dividends are projected to grow at a constant rate of 5% int

mars1129 [50]

Answer:

The holding period return is 8%

Explanation:

In this question we need to find the holding period return for the stock, and for that we would need to know what is the stocks current price, what would the stocks price be in one year and how much dividend it will pay during the year. Their last dividend paid was $4 and their dividend is expected to grow at 5% in the future so the dividend paid in the current year would be 4*1.05= 4.2.

To find the current price of the stock we will use the DDM formula

DDM= D*(1+G)/R-G

(4*1.05)/(0.08-0.05)

Price = 140

Now we need to know what the stocks price would be in one year. For that we need to know the previous dividend which is 4.20, the growth rate which is 5% and the required rate of return which is 8%

DDM= (D*(1+G)/R-G

4.2*1.05/0.08-0.05

Price = 147

So now we know the current price, current year dividend and year end price we can calculate the holding period return.

Holding period return = (Dividend +(End of period price-Initial Price))/Initial Price

Dividend = 4.20

End Period Price = 147

Initial Price = 140

Holding period return = 4.20+(147-140)/140

=11.20/140

=0.08

=8%

5 0

3 years ago

To increase and improve employees' work efforts in organizations, organizations should link ________ to ________ such as bonuses

Yanka [14]

Answer:

its c

Explanation:

8 0

3 years ago

Larry Ellison starts a company that manufactures high-end custom leather bags. He hires two employees. Each employee only begins

HACTEHA [7]

Answer:

12.55 days

Explanation:

Provided information

Number of employees 2

Average production time=1.8 days

Standard deviation=2.7 days

Inter-arrival time= 1 day

Coefficient of variation= 1 day

Standard deviation of inter-arrival time= 1 day

The coefficient of variations

Inter-arrival coefficient of variation

$C_{vi}=\frac {\sigma}{T}$ where $\sigma$ is standard deviation of inter-arrival time, T is inter-arrival time and $C_v$ is coefficient of variation of inter-arrival time

$C_{vi}=\frac {1 day}{1 day}=1$

Production time coefficient of variation

$C_{vp}=\frac {2.7}{1.8}=1.5$

Total utilization time

$U=\frac {T}{n*T_i}$ where T is the time of production, n is number of employees, U is utilization, $T_i$ is inter-arrival time

$U=\frac {1.8}{2*1}=0.9$

Therefore, utilization time by 2 employees is 0.9

Expected average waiting time

$T_e=(\frac {T}{n*T_i})*0.5(C_{vi}^{2}+C_{vp}^{2})*(\frac{U^{\sqrt{2(n+1)}-1}}{1-U})$

Where $T_e$ is expected average waiting time and the other symbols as already defined

Substituting 1.5 for $C_{vp}$ , 1 for $C_{vi}$ , 0.9 for U, 2 for n, 1 for $T_i$ and 1.8 for T

$T_e=(\frac {1.8}{2*1})*0.5(1^{2}+1.5^{2})*(\frac{0.9^{\sqrt{2(2+1)}-1}}{1-0.9})$

$T_e=0.9*1.625*8.583709=12.55367 days$ and rounding off to 2 decimal places we obtain 12.55 days

Therefore, expected duration between order received and beginning of production is approximately 12.55 days

4 0

3 years ago

A car dealership was trying to sell a used car that no one wanted. First, they tried to sell it for 10% off the marked price. Th

Rus_ich [418]

Answer:

Original Sale Price = $6000

Explanation:

Lets say that the original Sale price is 100%. When the first discount is offered, the car is discounted by 10% and offered for 90% of the original price.

The second discount is offered as 20% off from the discounted sale price. Thus the car is now offered at,

Price after Second Discount = 90% * (1 - 20%) = 72% of the original price

Now the final discount is offered as further 25% off from the Second Discounted price which is already 72% of the original price. Thus the price after final discount will be,

Price after final discount = 72% * (1 - 25%) = 54% of the original price

We know the price after final discount is 54% of the original price and we are provided the amount as 3240. Thus if 54% of original price is 3240, then the original price will be,

Original Sale Price = 3240 * 100%/54%

Original Sale Price = $6000

4 0

3 years ago

N average, someone with a Bachelor's degree is estimated to earn ____ times more than someone with a high school diploma. A

gregori [183]

People with a bachelor's degree make 84% more over a lifetime than high school graduates.

5 0

3 years ago