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Mazyrski [523]
3 years ago
11

The stock in Up-Towne Movers is selling for $45.20 per share. Investors have a required return of 9.9 percent and expect the div

idends to grow at 3.9 percent indefinitely. What was the dividend the company just paid?
Business
2 answers:
Travka [436]3 years ago
8 0

Answer: $2.61

Explanation:

We can use the Gordon Growth Model here of which the formula is,

P = D1 / r – g.

Where

P is the stock price

D1 = the annual expected dividend of the next year.

r = rate of return.

g = the expected dividend growth rate (assumed to be constant)

Making D1 the subject of the formula to find the next dividend will help us solve for the recent Dividend.

D1 = P (r-g)

= 45.20 (0.099 - 0.039)

= $2.712

$2.712 is the next dividend.

To calculate the most recent Dividend we can use the growth rate in the following manner,

D1 = D0(1 + g)

D0 = D1/(1+g)

D0 = 2.712 / 1.039

D0 = $2.61

The dividend the company just paid is $2.61

slamgirl [31]3 years ago
4 0

Answer:

The dividend the company just paid is $2.61

Explanation:

Since the dividend is expected to grow indefinitely, we can proceed by employing the Gordon Growth Model formula as follows:

P = D1/(r – g) ……………………………………… (1)

Where;

P = current share price = $45.20

D1 = next year dividend = ?

r = required return = 9.9%, or 0.099

g = dividend constant growth forever = 3.9%, or 0.039

Substituting the values into equation and solve for D1, we have:

$45.20 = D1/(0.099 – 0.039)

D1 = 45.20 × (0.099 – 0.039) = $2.712

Since D1 = D0 × (1 + g), we can solve for D0 as follows:

$2.712 = D0 × (1 + 0.039)

D0 = 2.712 ÷ 1.039

D0 = $2.61

Therefore, the dividend the company just paid is $2.61.

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Answer:

The correct answer is a. In arriving at taxable income, a taxpayer must choose between the standard deduction and itemized deductions.  

Explanation:

In tax law, the tax base is the magnitude that results from the measurement of the taxable event. It is defined as the dimension or magnitude of an element of the objective budget of the taxable event that is judged as determining the relative contributory capacity.

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Answer:

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Explanation:

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Answer:

$3,800

Explanation:

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Bills of doctor and dentist and hospital expenses 9,200

Less-received an insurance reimbursement 4,400

Add-prescribed medicines and drugs 3,000

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Answer:

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