Answer:
a. The stock's price one year from now is expected to be 5% above the current price.
Explanation:
Under gordon model:
If we calculate the value of the stock for the year after that:
to calculate the value of the increase we divide next year over current year.
We have demostrate that next year stock should increase by 1 + growth so statement c is correct.
Answer: True
Explanation:
Variable selling and administrative expenses increase with the number of sales so in order to get them, one needs to multiply the number of sales by the variable and administrative expenses.
This also goes for the budgeted variable selling expenses. To find out these costs, multiply the expected variable and admin expenses by the budgeted number of sales. The amount you get will show the amount of variable expenses to budget based on the sales you budgeted.
Answer:
b. $433,750
Explanation:
The ending balance in retained earnings can be calculated as;
= Beginning balance + Net income - Cash dividends
Given that;
Beginning balance = $430,000
Net income = $60,000
Cash dividends = $56,250
= $430,000 + $60,000 - $56,250
= $433,750
Therefore, the ending balance in retained earnings is $433,750
If the number of employed workers equals 200 million and the number of unemployed workers equals 20 million, the unemployment rate equals 9%.
<h3>What is the unemployment rate?</h3>
The unemployment rate is the percentage of the labour force that is unemployed.
The unemployment rate = (number of unemployed people / total labour force) x 100
Total labour force = 200 million + 20 million = 220 million
(20 / 220) x 100 = 9%
To learn more about unemployment, please check: brainly.com/question/10940465
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Answer and Explanation:
The computation is shown below:
a. Marpor's value without leverage is
But before that first we have to calculate the required rate of return which is
The Required rate of return = Risk Free rate of return + Beta × market risk premium
= 5% + 1.1 × (15% - 5%)
= 16%
Now without leverage is
= Free cash flows generates ÷ required rate of return
= $16,000,000 ÷ 16%
= $100,000,000
b. And, with the new leverage is
= (Free cash flows with debt ÷ required rate of return) + (Tax rate × increase of debt)
= ($15,000,000 ÷ 0.16) + (0.35 × $40,000,000)
= $93,750,000 + $14,000,000
= $107,750,000
