Answer:
CAPM = 12.30%
Dividend Growth Model= 10.32%
Explanation:
According to the capital asset price model: Expected rate of return = risk free + beta x (market premium)
5% + (0.73 x 10%) = 12.30%
according to the constant dividend growth model
price = d1 / (r - g)
d1 = next dividend to be paid
r = cost of equity
g = growth rate
$35 = $1.6 x (1.055) / (r - 0.055)
r = 1.688 / 35 + 0.055 = 0.1032 = 10.32%
Answer:
The correct answer is "true"
Explanation:
Integrated Brand Promotion (IBP) is a marketing element that allows you to coordinate your communication and relationships with your customers. It is based in promotional tools, including advertising, in-store displays, sampling and cents-off coupons to build and maintain sales levels.
Answer:
Therefore, Olivia should buy 10 apples and 8 bananas to maximize her utility.
Explanation:
Let A represent the number of apples bought and B represent the number of bananas bought. Therefore since Olivia has $4 to spend:
0.2A + 0.25B = 4 (1)
Also, the tangency condition can be used to find the optimal amount of A to relative to B. It is give as:
![MU_A/P_A=MU_B/P_B\\\\\frac{3\sqrt{\frac{B}{A} } }{0.2}= \frac{3\sqrt{\frac{A}{B} } }{0.25}\\\\15\sqrt{\frac{B}{A} }=12\sqrt{\frac{A}{B} }\\\\squaring\ both\ sides:\\\\\frac{225B}{A} =\frac{144A}{B}\\\\225B^2=144A^2\\\\B^2=0.64A^2\\\\Taking\ square\ root:\\\\B=0.8A](https://tex.z-dn.net/?f=MU_A%2FP_A%3DMU_B%2FP_B%5C%5C%5C%5C%5Cfrac%7B3%5Csqrt%7B%5Cfrac%7BB%7D%7BA%7D%20%7D%20%7D%7B0.2%7D%3D%20%5Cfrac%7B3%5Csqrt%7B%5Cfrac%7BA%7D%7BB%7D%20%7D%20%7D%7B0.25%7D%5C%5C%5C%5C15%5Csqrt%7B%5Cfrac%7BB%7D%7BA%7D%20%7D%3D12%5Csqrt%7B%5Cfrac%7BA%7D%7BB%7D%20%7D%5C%5C%5C%5Csquaring%5C%20both%5C%20sides%3A%5C%5C%5C%5C%5Cfrac%7B225B%7D%7BA%7D%20%3D%5Cfrac%7B144A%7D%7BB%7D%5C%5C%5C%5C225B%5E2%3D144A%5E2%5C%5C%5C%5CB%5E2%3D0.64A%5E2%5C%5C%5C%5CTaking%5C%20square%5C%20root%3A%5C%5C%5C%5CB%3D0.8A)
Put B = 0.8A in equation 1:
0.2A + 0.25(0.8A) = 4
0.2A + 0.2A = 4
0.4A = 4
A = 10
B = 0.8(A) = 0.8(10) = 8
Therefore, Olivia should buy 10 apples and 8 bananas to maximize her utility.
Answer:
Stock = 27.629 million
Explanation:
<u>Baldwin Corporation</u>
<u>Balance Sheets</u>
<u>Assets</u>
Cash of $8.040 million
Total Assets $163.111 million
<u>Liabilities and Owner's Equity </u>$163.111 million
Stock 27.629 million
Total Liabilities $101.255 million
Retained Earnings $34.226 million
According to Balance sheet approach total assets must equal total liabilities and Owner's Equity.
Total assets including cash are given which are equal to $163.111 million and when we subtract total liabilities and retained earning from it we get the value of stock.
Stock = Total Assets- Total Liabilities - Retained Earnings
Stock = $163.111 million - $101.255 million-$34.226 million
Stock = 27.629 million