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Naya [18.7K]
3 years ago
14

he value of a share of common stock depends on the cash flows it is expected to provide, and those flows consist of two elements

: (1) the dividends the investor receives each year while he or she holds the stock and (2) the price received when the stock is sold. The final price includes the original price paid plus an expected capital gain. True or false
Business
1 answer:
nekit [7.7K]3 years ago
3 0

Answer:

TRUE

Explanation:

Using the Gordon Growth Model,  we can adequately demonstrate that the dividend and price of a share are both components of the cashflow to be considered in share valuation.

Price per share is found to be D(1) / (r - g)  

where:

Do = Dividend now

D1 = Dividend in year 1

g = growth

r = required return

So we see that the market price of a share which determines the market capitalization of a company is predicted by a growth in dividends. So the benefits of holding a share will not only depend on how much the share is sold now as against how much it can be sold in the future (in order to make a gain), but also how much you can be earning until such sale occurs.

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Modern Federal Bank is setting up a brand-new branch. The cost of the project will be $1.2 million. The branch will create addit
KonstantinChe [14]

Answer:

23.12%

Explanation:

Internal rate of return (IRR) is the rate at which the Net present value (NPV) of a project equals to zero.

Using a financial calculator and the CF function, input the following to find IRR;

Initial investment; CF0 = -1,200,000

Yr1 cashflow inflow ; C01 = 235,000

Yr2 cashflow inflow ; C02 = 412,300

Yr3 cashflow inflow ; C03 = 665,000

Yr4 cashflow inflow ; C04 = 875,000

Then key in IRR CPT = 23.119%

Therefore, the Internal rate of return this expansion is 23.12%

3 0
2 years ago
However, when the entire residence staff listened to our argument again, they became convinced that the system wasn't fair. howe
kykrilka [37]
There is a difference in the change of pronounce used. The best (and probably correct answer) is the first sentence: <span>However, when the entire residence staff listened to our argument again, they became convinced that the system wasn't fair. The pronounce 'they' refer to the collective term of 'entire residence staff'.</span>
5 0
3 years ago
3. What fallacy is illustrated by the following statement? "This work is driving me crazy!"
disa [49]
<h3>Statement by Fallacy</h3>

"This work is driving me crazy!"

The above sentence is said by Fallacy a worker of a cafe in a busy shopping mall, She tries her best to serve the customers but the customers are quite rude and that is the reason why she said such a dialogue.

<h3>Customer Behaviour</h3>

Fallacy wants the customers to act kindly and be a little patient, but that is completely the opposite of what is reality.

She is unable to leave the job as it is a well paid job and she is not able to find another job that can pay her this much salary.

Learn more about Business at brainly.com/question/26675384

3 0
2 years ago
The number of customers who enter a bank is thought to be Poisson distributed with a mean equal to 10 per hour. What are the cha
VLD [36.1K]

Answer:

The probability that 2 or 3 customers will arrive in a 15-minute period is 0.4703

Explanation:

Firstly, we have to determine the segment unit, since the mean is 10 per hour, the segment unit is 1 hour.

The mean(m) = 10

since the period is 15 minutes = 0.25 hour, t= 0.25 hour / 1 hour. Therefore mt= 2*10 = 2.5

The poisson distribution formula P(x) = \frac{(mt)^{x}e^{-mt}  }{x!}

Therefore the probability that 2 or 3 customers will arrive in a 15-minute period

P(x=2) or P(x=3) = P(x=2) + P(x=3) = \frac{(2.5)^{2}e^{-2.5}  }{2!}+\frac{(2.5)^{3}e^{-2.5}  }{3!} = 0.2565 + 0.2138 = 0.4703

Therefore P(x=2) or P(x=3) = 0.4703

The probability that 2 or 3 customers will arrive in a 15-minute period is 0.4703

3 0
2 years ago
Read 2 more answers
Fancy Furniture produced a batch of 2,000 coffee tables at a cost of $355,000. It was discovered that the entire batch was finis
Law Incorporation [45]

Answer:

b) The $355,000 manufacturing cost of the tables already incurred.

Explanation:

The Business has already incurred this expense in making the coffee tables, this can not be done. Therefore, it does not make sense to consider this when considering whether to complete the

Tables, or sell them as they now are

All other points contribute either directly or indirectly to the decision that the company is about to take in this regard.

So, the correct answer is b

7 0
3 years ago
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