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nignag [31]
4 years ago
9

Red Sun Rising just paid a dividend of $2.43 per share. The company said that it will increase the dividend by 15 percent and 10

percent over the next two years, respectively. After that, the company is expected to increase its annual dividend at 4.1 percent. If the required return is 11.5 percent, what is the stock price today
Business
1 answer:
Sidana [21]4 years ago
4 0

Answer:

P0 = $39.76

Explanation:

The dividend discount model or DDM can be used to calculate the price of the share today. The DDM values a stock based on the present value of the expected future dividends from the stock. The price of this stock under this model can be calculated as follows,

P0 = D0 * (1+g1) / (1+r)  + D0 * (1+g1) * (1+g2) / (1+r)^2  +  

[ (D0 * (1+g1) * (1+g2) * (1+g3) / (r - g3)) / (1+r)^2 ]

Where,

  • g1 is the growth rate in the first year which is 15%
  • g2 is the growth rate in the second year which is 10%  
  • g3 is the constant growth rate which is 4.1%
  • r is the required rate of return
  • P0 is the stock price today

P0 = 2.43 * (1+0.15) / (1+0.115)  +  2.43 * (1+0.15) * (1+0.1) / (1+0.115)^2  +

[ (2.43 * (1+0.15) * (1+0.1) * (1+0.041) / (0.115 - 0.041)) / (1+0.115)^2 ]

P0 = $39.76

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bulgar [2K]

Answer & Explanation:

To determine the brand image goal, it is essential to identify the targeted market, segments first - who the brand serves and then conduct the market research to understand the demand, the tastes and preferences of the targeted customers.

Based on these information, we can use marketing mix to achieve the goal.

Product

If the brand has already chosen the sector to operate it, it should base on the market taste and demand to determine things related to the product, including: the functions, packaging, appearance, added value for customers, quality, and other supported services (such as warranty). These are information that customers usually consider when they make a purchasing decision. So that the brand should clarify the information about features of products, add benefits that the users can earn from the products.

Price

When determining the pricing strategy, the brand does not only consider the product price but also discounts policy, credit terms, etc. These would base on the position of the brand in the marketplace (in low price, premium or low-medium, etc. and providing high, low or medium quality products, etc.). This bases on the products the brand offers after considering the consumption habit, power of the targeted segments.

Place

Brand has to identify where the products are seen, distributed and purchased so as to approach the largest amount of potential customers. In the place strategy, the prioritized goal is to assure the products are accessible to the targeted customers. (For example, the brand can provide their products at convenient stores if this is the more preferred shopping places of targeted customers.)

Promotion

This refers to the activities to make the brand known more and attract more buyers, including types of advertisement, sponsorship, etc. There are two most common ways of promotion is promote directly the users or promote the distributors (the wholesalers) to import and sell the products of your brand.

People

The people strategy involves in the image of people participated in the brand such as staff, salesperson, other employees. This affects mainly the customer services - which would have considerable impact on the perception of customers about the brand. The people strategy can base on the image they want to target, for example to be basic, friendly or to make the customers feel the vibe of luxurious brand.

3 0
3 years ago
In the social class model developed by Gilbert and Kahl, members of the __________ have earned most of their money during their
Alexxandr [17]

Answer: Lower -Upper Class

Explanation:

The lower‐upper class are those who acquired money from investments or business. They are also professionals who went to the highest level of school and by perseverance and hard work are living good lives.. They clude entrepreneurs, presidents of major corporations, sports entertainment celebrities, and top-level professionals also are doctors, accountants, engineers, lawyers.

They are part of the Upper class system who have money that they can spend although they are lower than the Upper-Upper Class who were born into extreme wealth. These people live in great neighborhoods, mingle with like minds and send their children to the finest schools.

5 0
3 years ago
What is an exchange rate? A. How much bonds are worth when they're exchanged with cash B. How much dollars are worth when they a
lidiya [134]

Hello!
The answer is

C. How much a currency is worth when it's exchanged with another country's currency.

Good luck!

6 0
3 years ago
Trek Cycles makes two products: X-1 and X-2. It takes 80,900 direct labor hours to manufacture the X-1 and 93,500 direct labor h
Vera_Pavlovna [14]

Answer:

Predetermined manufacturing overhead rate= $2.15 per direct labor hour

Explanation:

Giving the following information:

It takes 80,900 direct labor hours to manufacture the X-1 and 93,500 direct labor hours to manufacture the X-2 Line.

Total overhead= 225,000 + 149,960=  $374,960

To calculate the predetermined manufacturing overhead rate we need to use the following formula:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 374,960 / (80,900 + 93,500)

Predetermined manufacturing overhead rate= $2.15 per direct labor hour

6 0
4 years ago
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marishachu [46]

Answer:

Store of value.

Unit of account.

Medium of exchange.

Explanation:

Store of value is an asset that can be restored and then traded with other things. When the assest is redeemed it is expected to be of great value. Also a store of value is anything that holds purchasing power in the future.

Unit of account is one of the primary functions of money. Also defined as the unit by which value of a thing is accounted and compared.

Medium of exchange occurs when there is any transaction between buyers and sellers.

5 0
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