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GarryVolchara [31]
3 years ago
11

Assume that you plan to buy a share of EMA stock today and to hold it for 3 years. You expect to receive a dividend of $3.00 at

the end of Year 1, $3.50 at the end of Year 2, and a dividend of $4.0 at the end of Year 3. In addition, you expect to sell the stock for $75 at the end of Year 3.
If your expected rate of return is 10%, how much should you be willing to pay for this stock today?
Business
1 answer:
Vesnalui [34]3 years ago
4 0

Answer:

$67.5

Explanation:

Expected rate of return = 10/100 x $75 = $7.5

I am willing to pay $75 - $7.5 = $67.5

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Why might a business owner prefer to raise capital through a loan rather than through selling shares to an investor ?
MArishka [77]

Answer:

Shareholders can have control over business decisions. With a loan, all the owner owes is principle and interest

7 0
4 years ago
Sam's Pizza is considering a new store location. For accounting purposes, fixed operating costs for a store are $245,000 a year,
Yuki888 [10]

Answer:

33,793   pizzas

Explanation:

The annual break-even sales level for the number of pizzas sold in the location is computed using the break-even sales units formula  below:

break-even sales=fixed costs/contribution margin per pizza

fixed costs=$245,000

contribution margin per pizza=selling price-variable cost

selling price=$12.50

variable cost=selling price*42%

variable cost=$12.50*42%

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5 0
3 years ago
In the United States many farms are integrated into a large food-production industry. This is known as:
Zielflug [23.3K]
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8 0
3 years ago
Read 2 more answers
has a standard of 2 direct labor hours per unit. The standard wage rate of each worker is $32.50 per hour. In July, the company
ikadub [295]

Answer:

$130 Favourable

Explanation:

Given the above information,

Standard hours = 2 × 4770 = 9,540

Actual hours = 8,940

Standard rate = $32.50

Then, Direct labor efficiency variance is computed as

= ( Standard hours allowed for production - Actual hours taken) × Standard rate per direct labor hour

= [(2 × 4,770) - 8,940] × $32.50

= [9,540 - 8,940] × $32.50

= 600 × $32.50

= $130 Favourable

6 0
3 years ago
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