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yuradex [85]
3 years ago
14

A company hired you as a consultant to help them estimate its cost of capital. You have been provided with the following data: D

1 = $2; P0 = $40; and g = 3% (constant). Based on the constant dividend growth model approach, what is the cost of equity?
Business
1 answer:
Kaylis [27]3 years ago
6 0

Answer:

8%

Explanation:

The formula to compute the cost of common equity under the DCF method is shown below:

= Current year dividend ÷ price + Growth rate

where,

Current year dividend is $2

Price is $40

And, the growth rate is 3%

Now put these values to the above formula  

So, the cost of equity would equal to

= $2 ÷ $40 + 3%

= 0.05+ 0.03

= 8%

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Answer:

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Explanation:

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My doing he outlet, the opportunity to paint is forgone

Amy = 8/6 = 1.33

Bill = 5/5

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3 years ago
On July 1, 2019, Sheffield Corp. pays $20,700 to Kalter Insurance Co. for a 3-year insurance contract. Both companies have fisca
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Explanation:

The journal entries are as follows:

On July 1

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3 0
3 years ago
the bookkeeper for Blue Spruce Equipment Repair made a number of errors in journalizing and posting, as described below. For eac
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Answer:

Note: The full question is attached as picture below

                               (a)                   (b)                   (c)  

                                In                                      Larger  

                            Balance      Difference       column

1.                               No               $725             Debit  

2.                             Yes                 NA                NA  

3.                              Yes                 NA                NA  

4.                               No               $225            Credit  

5.                              Yes               $684               NA  

6.                               No                $45             Credit

7 0
3 years ago
What is the rate at which one currency is converted to another currency called?
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My answer would be C ''Foreign Exchange Rate''.
4 0
3 years ago
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