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Oliga [24]
4 years ago
15

The Jones Company has decided to undertake a large project. Consequently, there is a need for additional funds. The financial ma

nager plans to issue preferred stock with a perpetual annual dividend of $5 per share and a par value of $30. If the required return on this stock is currently 20 percent, what should be the stock's market value?
Business
1 answer:
vova2212 [387]4 years ago
4 0

Answer: $25

Explanation: Dividends are the returns the shareholders of the company get for investing the the company and bearing the risk and it is calculated as follows :-

Dividend = (value of share) * (rate of return)

Here we have,

Dividend = $5

rate of return = 20%

Therefore,

value\:of\:share\:=\:\frac{dividend}{rate\:of\:return}

value\:of\:share\:=\:\frac{\$5}{20\%}

                                = $25

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What is the net present value of the project? experiment with changing the discount rate in one percent increments (e.g., 13%, 1
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3 0
3 years ago
A company purchased a new delivery van at a cost of $58,000 on July 1. The delivery van is estimated to have a useful life of 4
kati45 [8]

Answer:

<u>a. $13,350</u>

Explanation:

Using straight-line method of depreciation the depreciable value of an assets is expensed over the useful life of the asset equally each year.

Use following formula to calculate the depreciable value

Depreciable value = Cost of asset  - Salvage value

Placing values in the formula

Depreciable value = $58,000 - $4,600

Depreciable value = $53,400

Now use following formula to calculate the depreciation value of each year

Depreciation expense = Depreciable value of the asset / Useful life of the asset

Placing values in the formula

Depreciation expense = $53,400 / 4 years

Depreciation expense = $13,350

7 0
3 years ago
g An individual has $20,000 invested in a stock with a beta of 0.8 and another $50,000 invested in a stock with a beta of 1.6. I
Free_Kalibri [48]

Answer:

1.37

Explanation:

The computation of the portfolio beta is shown below:

<u>Value                   Weight             Beta       Weighted Beta </u>

<u>of Investment    of Investment    (weight of value × beta) </u>

$20,000              0.2857           0.8       0.22856

$50,000               0.7143            1.6         1.14288

Total = $70,000     1                                  1.37

We simply multiplied the weight of investment with the beta of each investment so that the portfolio beta could come

7 0
4 years ago
You are told that the four-firm concentration ratio in an industry is 20. Based on this information you can conclude that:
nata0808 [166]

When a person is told that the four-firm concentration ratio in an industry is 20 this means that: C. The four largest firms account for 20 percent of industry sales.

<h3>What is the four-firm concentration ratio?</h3>

The four-firm concentration ratio is a term that refers to the market share of the four largest firms being observed. When the concentration ratio increases, the market industry also experiences a corresponding increment.

Also when this concentration ratio is more than half or 50%, the market can be said to be overly concentrated. So, the response above aptly describes the meaning of the four-firm concentration.

Learn more about market share here:

brainly.com/question/25309906

#SPJ4

8 0
2 years ago
In 2006, Gap Inc. ended their relationship with 23 production facilities due to code violations. Several closings occurred becau
kogti [31]

Answer: Social responsibility.

Explanation: The action portrayed by Gap Inc. demonstrates an expemplary attitude worthy of emulation which nails down the principle of social responsibility by organizations. This principle looks beyond the profits and revenue generated by the company but also aims to play it's role and ensure that it's actions does not violate or degrade social ethics. The closure of some facilities due to human right violation and subsequent enforcement of compliance with the code and conduct is a strict signal towards the company's strict stance at supporting and enforcing social responsibility.

6 0
3 years ago
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