1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
DochEvi [55]
3 years ago
5

Tresnan Brothers is expected to pay a $1.1 per share dividend at the end of the year (i.e., D1 = $1.1). The dividend is expected

to grow at a constant rate of 4% a year. The required rate of return on the stock, rs, is 15%. What is the stock's current value per share? Round your answer to two decimal places.
Business
1 answer:
forsale [732]3 years ago
7 0

Answer:

$10

Explanation:

Given that,

Expected Dividend paid per share, D1 = $1.10

Growth rate of dividend = 4% a year

Required rate of return on the stock, rs = 15%

Stock's current value per share:

= D1 ÷ (Required rate of return - Growth rate of dividend)

= $1.1 ÷ (0.15 - 0.04)

= $1.1 ÷ 0.11

= $10

Therefore, the stock's current value per share is $10.

You might be interested in
What is the total return for a stock that currently sells for $100, pays a dividend in one year of $2, and has a constant growth
Kobotan [32]

What is the total return for a stock that currently sells for $100, pays a dividend in one year of $2, and has a constant growth rate of 8 percent?

Total return will be 10%.

What is total return?

The overall return is shown as a proportion of the initial investment. For instance, a total return of 20% signifies that the asset's value increased by 20% overall as a result of price growth, dividend payments (if the security is a stock), coupon payments (if the security is a bond), or capital gains (if a fund).

R  = 10%

10% is the total return for a stock that currently sells for $100, pays a dividend in one year of $2, and has a constant growth rate of 8 percent.

Learn more about total return here:

brainly.com/question/28165464

#SPJ4

7 0
2 years ago
West Company borrowed $36,000 on September 1, 2016 from the Valley Bank. West agreed to pay interest annually at the rate of 6%
Illusion [34]

Answer:

$720

Explanation:

Given that,

Principal = $36,000

Rate = 6% per year

Note issued by West carried an 18-month term.

Time period: 1st September to December = 4 Months

Interest expense = Principal × Rate × Time period

= 36,000 × 6% × (4 ÷ 12)

= $720

Therefore, the amount of interest expense appearing on West's 2016 income statement would be $720.

5 0
3 years ago
Identify and discuss the “needs” of a society.
sweet [91]

A traditional list of immediate "basic needs" is food (including water), shelter and clothing. Many modern lists emphasize the minimum level of consumption of 'basic needs' of not just food, water, clothing and shelter, but also sanitation, education, and healthcare.

7 0
4 years ago
6. Suppose that the returns on the stock fund presented in Spreadsheet 6.1 were 240%, 214%, 17%, and 33% in the four scenarios.
Basile [38]

Answer:

Explanation:

Base on the scenario been described in the question, stock variance refers to the volatility that arises from the average. Volatility shows the degree of risk that will be helpful in determining the level of risk an investor should take while purchasing a particular security.

5 0
3 years ago
A consumer equilibrium is a situation in which a consumer has allocated​ _____ of her income in a way that​ _____. A. ​all; maxi
ludmilkaskok [199]

Answer:

The correct answer is (D) all, maximizes her total utility.

Explanation:

Consumer's equilibrium is a defined as a situation in which an individual uses his or her money to buy goods in a manner in which the person obtains the highest satisfaction and has no need for a change in the level of consumption on account of the price of the product.

Consumer equilibrum enables an individual to obtain complete satisfaction from his or her money. Consumer equilibrum is found by comparing the ratio of the marginal utility to the price of a commodity.

3 0
3 years ago
Read 2 more answers
Other questions:
  • Project P requires an investment of 4000 at time 0. The investment pays 2000 at time 1 and 4000 at time 2. Project Q requires an
    13·1 answer
  • For analysis purposes Jay considers his restaurant to have three revenue centers. These are the dining room, the bar and off-sit
    10·1 answer
  • Write a three-paragraph essay describing the value and benefits of using a balanced scorecard for management control. Compare an
    9·1 answer
  • Kaila, the owner of a costume shop, has a three-year strategic goal to serve 15 percent more customers and increase margins by 5
    11·1 answer
  • In its first year of operations, Grace Company reports the following: Earned revenues of $60,000 ($52,000 cash received from cus
    14·1 answer
  • Software that manages "back office" functions such as billing, production, inventory management, and human resources management
    7·1 answer
  • magine that the current owner of the land in the previous exercise was willing to sell the land for $2 million. Assuming this am
    8·1 answer
  • The government in Chile recently informed Clint Travis' company that his retail grocery chain in Chile would have to be graduall
    8·1 answer
  • The employment process is carried out by which department?
    5·1 answer
  • At the __________ stage of transforming raw materials into finished goods, managers typically use __________ control methods to
    12·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!