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Stolb23 [73]
3 years ago
6

Asonia Co. will pay a dividend of $5.20, $9.30, $12.15, and $13.90 per share for each of the next four years, respectively. The

company will then close its doors. If investors require a return of 9.6 percent on the company's stock, what is the stock price?
Business
1 answer:
igomit [66]3 years ago
3 0

Answer:

$31.35 (Approx)

Explanation:

Require a return on company's stock = 9.6%

Dividend:

Year 1 = $5.20

Year 2 = $9.30

Year 3 = $12.15

Year 4 = $13.90

Therefore,

Stock price:

= Future dividends × Present value of discounting factor(rate%,time period)

=\frac{5.20}{1.096}+\frac{9.3}{(1.096)^{2} }+\frac{12.15}{(1.096)^{3} }+\frac{13.90}{(1.096)^{4} }

= $31.35 (Approx)

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4 0
3 years ago
Read 2 more answers
Joe Jenkins, the owner of Jenkins Manufacturing, is considering whether to produce a new product. Joe will be selling the produc
Paul [167]

Answer:

Jenkins Manufacturing

Joe should produce using the new equipment.

Explanation:

a) Costs incurred using the old equipment:

Variable costs = $45,000 ($50 x 900)

Fixed costs = $40,000

Total costs = $85,000

Operating Loss = $22,000 ($63,000 - 85,000)

b) Costs incurred using the new equipment:

Variable costs = $22,500 ($25 x 900)

Fixed costs = $60,000

Total costs = $82,500

Operating Loss = $19,500 ($63,000 - 82,500)

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7 0
3 years ago
Some countries share a common currency (e.g., those that participate in the euro), while some other countries peg their currenci
nikklg [1K]

Answer:

The potential of additional regional currencies such as the euro is very important, and for this reason, many economists support the idea. In fact, John Maynard Keynes, one of the most influential economists in history, once proposed not a regional common currency, but a common global currency.

The potential lies in the fact that regional currencies allow to coordinate a common monetary policy in several countries. This common policy means that several countries now have the same interest rates, the same rate of inflation, and the same currency itself, and all these commonalities facilitate the exchange of goods and services.

While the Euro has had drawbacks since its inception, the Euro has survived, and is now one of the strongest curriencies in the world.

If you support the concept, should those currencies be tied to regional economic blocs?

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4 0
3 years ago
The Dogwood Technology Company managerial accountant computes the May total variance report. The budgeted fixed overhead was $ 4
Jobisdone [24]

Answer:

$750 favorable ; $200 unfavorable

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The computations are shown below:

For fixed overhead budget variance:

= Budgeted fixed overhead - actual fixed overhead

= $47,420 - $46,670

= $750 favorable

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= Budgeted fixed overhead - standard fixed overhead cost allocated to production

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= $200 unfavorable

Hence we consider all the given information

8 0
3 years ago
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