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vichka [17]
4 years ago
6

he Lo Company earned $2.60 per share and paid a dividend of $1.30 per share in the year just ended. Earnings and dividends per s

hare are expected to grow at a rate of 5 percent per year in the future. Determine the value of the stock if the required rate of return is 12 percent.
Business
1 answer:
hichkok12 [17]4 years ago
4 0

Answer:

The value of the stock is $19.50

Explanation:

Hi, let´s check out the formula that we need to use in order to find the price of this stock.

Price=\frac{Do(1+g)}{r-g}

Where:

Do= last dividend (in our case, $1.30)

g = growth rate of the dividend (in our case, 5% or 0.05)

r = required rate of return (in our case, 12% or 0.12)

Everything should look like this:

Price=\frac{1.30(1+0.05)}{0.12-0.05} =19.50

Therefore, the value of this stock is $19.50

Best of luck.

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<h3>What is selective optimization with compensation theory?</h3>

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Learn more about the three main factors of Selective Optimization with Compensation Theory at brainly.com/question/7227453

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Assuming no change in taxes, an increase in government spending (g) of $100 billion with an mpc of 0.80 will add a total of $___
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The answer is 180..........
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Strategically, AB InBev has 10 principles driving everything they do. At the core, AB InBev is focused on a shared dream that en
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Answer:

Consider the following explanation.

Explanation:

The international business environment is complex and requires a number of steps to be taken by the organizations that operate in the global environment. The large multinational corporations (MNC’s) should have both strong principles as well as flexible structure to operate at the global level. The strong principles help in creating uniformity at the global level and guide a common organizational culture.

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3 years ago
Larkspur Co. had cost of goods sold of $3,100. If beginning inventory was $3,200 and ending inventory was $1.050. Larkspur's pur
AleksandrR [38]

Answer:

cost of goods purchased= $950

Explanation:

Giving the following information:

Larkspur Co. had cost of goods sold of $3,100.

Beginning inventory was $3,200

Ending inventory was $1,050

<u>To calculate the purchases, we need to use the following formula:</u>

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On her first day on the job in the fast food restaurant, Kayla's supervisor spent considerable time with her, explaining procedu
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Answer: Role taking

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