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Minchanka [31]
3 years ago
7

ssume that Kish Inc. hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D 0 =

$0.90; P 0 = $27.50; and g = 7.00% (constant). Based on the DCF approach, what is the cost of equity from retained earnings? 9.29% 9.68% 10.08% 10.50% 10.92%
Business
1 answer:
Rufina [12.5K]3 years ago
7 0

Answer:

Option (D) is correct.

Explanation:

Given that,

Dividend, D0 = $0.90

Price, P0 = $27.50

Growth rate, g = 7.00% (constant)

D1 = D0 (1 + g)

    = $0.90 × (1 + 0.07)

    = $0.90 × 1.07

    = $0.963

Cost of equity, Ke = [ D1 ÷ P0 ] + g

                               = [$0.963 ÷ $27.50 ] + 0.07

                              = 0.0350 + 0.07

                               = 0.1050 i.e 10.50 %

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Montano1993 [528]

Answer:

The quantity that Sarah's Machinery Company is indifferent between two technologies is 5.

Explanation:

We are looking for the quantity that Sarah's Machinery Company is  indifferent between two technologies,  so we have to find the quantity that the total cost with technology A is the same to the total cost with technology B

Total cost  technology A=500+50x

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500+50x=250+100x

500-250=100x-50x

250=50x

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7 0
3 years ago
You are tearing down a building and find $1 in change that someone lost when working on the building 140 years ago. If, instead
igor_vitrenko [27]

Answer:

The correct answer is D: $16

Explanation:

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Number of Years to Double= 70/Annual Rate of Return

In this exercise= 70/2= 35 years

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6 0
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Mekhanik [1.2K]
If the person created it or is in the family then yes
6 0
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Jules has incorporated a business, The Spree Chocolatier. It has facilities in five major cities in California, Arizona, and Was
Nady [450]

Answer:

Spree Chocolatier would be considered as both the state of incorporation and the state of its principal place of business

Explanation:

The Spree Chocolatier would be considered a citizen of both the state of incorporation and the state of its principal place of business According to federal diversity purposes because based on the information given the Spree Chocolatier which was incorporated by Jules has several of their facilities in five major cities which include California, Arizona, and Washington in which after fulfilling the contract for the 500 fancy desserts for a banquet, the same Spree Chololatier has client in Seattle, Washington which refused to pay which makes Jules to brought suit this means Spree Chocolatier would be considered a citizen of both the state of incorporation and the state of its principal place of business because the state of incorporation and the state of its principal place of business are the 5 major cities in which Jules incorporated his business.

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sammy [17]

Answer:

Gross Profit

Explanation:

Gross Profit is defined as the amount earned by the company, after deducting the cost of producing and selling the products in case of a manufacturing business, or the cost of providing services to customers in case of service oriented business. Therefore, the difference between sales revenue and the cost of goods sold is called Gross Profit.

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4 0
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