Answer:
D. Project A has a standard deviation of expected returns of 20%, while Project B's standard deviation is only 10%. A's returns are negatively correlated with both the firm's other assets and the returns on most stocks in the economy, while B's returns are positively correlated. Therefore, Project A is less risky to a firm and should be evaluated with a lower cost of capital.
Answer:
The stock is worth $17.50 per share today
Explanation:
The price per share today can be calculated using the DDM where expected dividends are discounted back to present value to calculate the share price. When the dividend growth becomes zero, we will calculate the terminal value at the end of Year 3 and discount it back too. The formula for price of the stock today is,
P0 = D1 / (1+r) + D2 / (1+r)^2 + D3 / (1+r)^3 + [ (D4 / r) / (1+r)^3]
P0 = 1.45 / (1+0.09) + 1.5 / (1+0.09)^2 + 1.53 / (1+0.09)^3 +
[ (1.6 / 0.09) / (1+0.09)^3]
P0 = $17.50
We depreciate assets over their useful lives instead of just expending them in the year they were acquired because let's say, when we exhaust a 5 year asset in a year, the 1st year is understated because the whole expense of the asset has been fully utilized in just 1 year, while the remaining 4 years are overstated,
Answer:
who the hell keeps helping novice businesses people open up? - a business major - yeah the last two were too.
Explanation:
Summary? Left over cash?
Answer:
B) no longer applies.
Explanation:
Based on the information given the perfect tender rule will NO LONGER APPLIES because the seller which is Cattle Ranch is yet to deliver the cattle to Beef Burgers, Inc before the outbreak of the disease causes a quarantine of the ranch, which is why the perfect tender rule states that a buyer is only permitted to reject goods that is been delivered to him or her from a seller only in a situation where the seller's delivered the goods in way that are not perfect or that does not meet the contract agreement between both the buyer and the sellers or in a situation where the goods did not conform to the description which may make the buyer to legally reject the goods delivered.
Therefore based on above scenario between Beef Burgers, Inc the buyer and Cattle Ranch the perfect tender rule will NO LONGER APPLIES .