Answer:
The stock price would be higher by $7.37
Explanation:
Free cash flow to equity = 195 million with a growth rate of 2% in perpetuity
Value of equity = Free cash flow to equity ÷ (Ce -g) = 195 million ÷ (13% - 2%)
= 190 ÷ 0.11 = $1,772,727,272.73 = $1,773 million
If growth rate is 3%, value of equity = 195 ÷ (13%-3%) = 195 ÷ 0.1 = $1,950 million
a. Value of stock = (1,773 + 15) million ÷ 22 = $81.27
b. Value of stock with 3% = 1,950 ÷ 22 = $88.64
Thus stock price would be higher by = b-a = $7.37
Answer:
A net cash outflow or cash used up of $20,000
Explanation:
The statement of cash flows show the movement in cash balances between the start and end of an accounting period. This movement is as a result of 3 groups of activities namely; operating, investing and financing activities.
Cash activities related to elements of working capital are recognized in the operating section. An increase in a current asset other than cash is treated as an out flow of cash while an increase in a current liability is treated as an inflow of cash and vice versa.
Hence the net effect on cash from operations under the indirect method
= -$43,000 + $23,000
= -$20,000
Answer:
option (c) depreciate by exactly 10 percent
Explanation:
Data provided in the question:
Canadian dollar = 0.75 US dollars per Canadian dollar
Canada's rate of inflation = 0 percent
US rate of inflation = 10 percent
Now,
The percentage change in real exchange rate
= percentage change in nominal exchange rate - (Domestic inflation - Foreign inflation)
= 0 - (10 percent - 0 percent )
= - 10 percent
Here,
the negative sign depicts that the exchange rate will depreciate
Hence,
the answer is option (c) depreciate by exactly 10 percent
The three state taxes are what you earn, taxes on what you buy, and taxes on what you own.
Earn: individual income taxes, corporate income taxes, payroll taxes, and capital gains taxes;
Buy: sales taxes, gross receipts taxes, value-added taxes, and excise taxes;
Own: property taxes, tangible personal property taxes, estate, and inheritance taxes, and wealth taxes.
