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Sedbober [7]
3 years ago
6

This morning you purchased a stock that just paid an annual dividend of $3.10 per share. You require a return of 9.2 percent and

the dividend will increase at an annual growth rate of 4 percent. If you sell this stock in three years, what will your capital gain be?
Business
1 answer:
sergiy2304 [10]3 years ago
6 0

Answer:

$2.48

Explanation:

This morining a stock was purchased.

The stock just paid an annual dividend of $3.10 per share

A return of 9.2% is required

= 9.2/100

= 0.092

The growth rate is 4%

= 4/100

= 0.04

The first step is to calculate today's price

= D1/(r-g)

=3.10× 1+0.04/0.092-0.04

= 3.10×1.04/0.092-0.04

= 3.224/0.052

= $62

The price at the end of year 3 can be calculated as follows

= today's price × (1+g)

= 62×(1+0.04)

= 62×1.04

= $64.48

Therefore, the capital gain can be calculated as follows

Price at the end of year 3-today's price

= $64.48-$62

= $2.48

Hence the capital gain is $2.48

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What is the growth that takes place in the uterus during pregnancy known as?
Tanzania [10]

Answer:

Foetal Development.

Explanation:

Foetal development is the growth of a fetus in the uterus of  mammals that takes place during their gestation period. This growth starts at the fertilization stage and then continues to grow into a newborn till the time of childbirth. In humans, this growth is also referred to as antenatal development.

7 0
2 years ago
Assume you have collected the following data for your project. Its budget is $75,000 and it is expected to last 4 months. After
Kitty [74]

Answer:

0.85 and 1.04

Explanation:

The computations are shown below:

Schedule performance index (SPI)

= (Earned Value) ÷ (Planned Value)

= ($38,500) ÷ ÷($45,000)

= 0.85

Because we see that SPI is less than 1 which means that less work is done than expected or planned work. Hence, it is bad news

And, the cost performance index would be

= (Earned Value) ÷ (Actual Cost)

= ($38,500) ÷ ($37,000)

= 1.04

Because we see that CPI is more than 1 which means earning is more than the actual cost. Hence, it is bad news and it is under the budget

5 0
3 years ago
A parent holding company sells shares in its subsidiary such that the parent now owns only 65% of the subsidiary and, thus, the
Volgvan

Answer:

10.2%

Explanation:

Total annual dividends $2,500,000

the actual dividends received deduction is 80%, but since the question states that it is 70%, we must subtract 70% of $2,500,000 = $750,000

the company will be taxed only on $750,000 of dividends that it received:

total taxes paid = $750,000 x 34% = $255,000

effective tax rate = total taxes paid / total dividends received = $255,000 / $2,500,000 = 10.2%

5 0
3 years ago
When the Fed decreases the money supply, we expect
tester [92]

Answer:

b. interest rates to rise and stock prices to fall.

Explanation:

Interest rates are the prices of money (the cost to borrow money for use) so when money is scarce (decreased money supply) rates will rise.

When interest rates rise, people will cut down on spending and investment causing corporate earnings to decrease, causing the price of stocks to decrease.

6 0
3 years ago
Why are businesses concerned about non renewable resources?
Mars2501 [29]
Because eventually it could run out if not used efficiently 
8 0
3 years ago
Read 2 more answers
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