Answer: The importance of liquidity
Explanation:
The financial principle at play is the importance of liquidity. Liquidity is the ease with which asset can be converted to cash. Maiko's asset has helped her to solve her financial issues she is experiencing after her job loss, therefore this shows the importance of liquidity.
Answer:
Option (a) is correct.
Explanation:
Given that,
Dividend pay in year 7, D7 = $2 per share
Growth rate of dividend, g = 2.2 percent per year
Required return, ke = 16 percent
Present value of the future dividend at year 6:
= D7 ÷ (ke - g)
= $2 ÷ (0.16 - 0.022)
= $14.49
Therefore, the present value of dividend now is as follows;
= Present value of the future dividend at year 6 × (1 + ke)^{-6}
= $14.49 × (1 + 0.16)^{-6}
= $5.95
Answer:
The correct answer is A)NPV would be understated.
Explanation:
NPV is the difference between the present value of cash inflows and the present value of cash outflows over a period of time.
The Salvage value is added at the end of the cash flow. So is a cash inflow.
And if we ignore salvage value the difference, the cash inflows will be smaller, so the NPV would be understated.
Answer:
B. $19.09
Explanation:
D1 = $0.50
D2 = $1.00
D3 = $1.50
D4 = $2.00
D5 = D4(1+g)
and <em>g</em> is given as 6%
D5 = 2.00(1.06) = 2.12
Next, find the PV of each dividend at a discount rate of 14%
PV(D1) = 0.50/(1.14) = 0.4386
PV(D2) = 1.00/(1.14²) = 0.7695
PV(D3) = 1.50/(1.14³) = 1.0125
PV(D4) = 2.00/(1.14^4) = 1.1842
Find the present value of the terminal value (D5 onwards);
PV(D5 onwards) = 
Sum up the PVs to find the current value of the stock;
= 0.4386 + 0.7695 + 1.0125 + 1.1842 + 15.6901
= 19.0949
Therefore, the current value = $19.09
The type of recording system that the teacher is using in
counting the times that the student had raised their hands in his or her class
is the event recording, this type of recording system is a way of having to
document the behavior whenever the behavior has happened or it has been
triggered.
