Answer:
Sell Price= $1044
Explanation:
Equity Risk Premium = Market Return - Risk Free Rate
= 13 - 5
= 8%
Risk Free Rate = 5%
Beta = 1
Expected Return on stock = Risk-free rate + Equity risk premium * Beta for stock
= 5 + 1*8 = 13%
Current Price = Present Value of Future Payments
75 = 6*(1+i)^-1 + Sell Price*(1+i)^-1 , where i=13%
Sell Price = 74.572/0.0714
Sell Price= $1,044
Answer:
Contribution margin per unit = $7.8
Contribution Margin Ratio = 60% or 0.6
Total contribution margin at 2250 units = $17550
Explanation:
The unit contribution is the difference in the unit selling price and unit variable cost for a product.
The unit contrbution margin for Red Hawk = 13 - 5.2 = $7.8 per unit
The contribution margin ratio simply represents the unit contribution margin as a percentage of selling price.
The contribution margin ratio = contribution margin per unit / selling price per unit
For Red Hawk CM Ratio = 7.8 / 13 = 0.6 or 60%
Total Contribution margin at 2250 units = 7.8 * 2250 = $17550
Answer:
The Rate of return expected from the stock is <u>14.47%</u>
Explanation:
Holding period return is the rate of return paid on the investment in the specific stocks in the form of dividend and appreciation in the value of the stock as well until the stock is held.
Firste we need to calculate the return on investment
Return on investment = Dividend Paid in the period + Appreciation in the value of stock
Placing values in the formula
Return on investment = $1.54 + ( $32.80 - $30 ) = $1.54 + $2.80 = $4.34
Now calculate the return rate as follow
Holding period return = ( Return on investment / Initial price of the stock ) x 100
Placing values in the formula
Holding period return = ( $4.34 / $30 ) x 100
Holding period return = <u>14.47%</u>
Answer:
Home owner’s insurance: most homeowners insurance policies provide a minimum of $100,000 worth of liability insurance. The costs for such a policy would be $500 deductible.
Medical Insurance: For a four person household with a family income of $75,000 in Virginia would be approximately $600 a month. This would not include supplementary insurance.
Automobile insurance: To insure to cars up to $50,000 in damages each, would cost $1,200 a year, paid every 6 months. This assuming that only 2 people in the household have driver’s licenses.
Explanation:
This was the sample answer given
