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sveticcg [70]
3 years ago
7

Jefferson's recently paid an annual dividend of $1.31 per share. The dividend is expected to decrease by 4% each year. How much

should you pay for this stock today if your required return is 16%?
Business
2 answers:
Vlad [161]3 years ago
8 0

Answer:

$6.29

Explanation:

Dividend is $1.31 per share

Decreased by 4%

Required return is 16%

Therefore:

Price = [$1.31 × (1 - .04)]/[.16 - (-.04)] = $6.29

I am Lyosha [343]3 years ago
7 0

Answer:

I should pay $10.92 per share for the stock today  as shown below

Explanation:

The maximum price a rational investor could pay for a share is given by the formula:

Po=Div/rate of return-growth rate

Po is the price to paid

Rate of return here is 16%,which is similar to return on equity

The growth rate of the share of the dividend is 4%

Po=$1.31/(0.16-0.04)

Po =$10.92

The price has factored in both the dividend yield and gains yield of the share.

dividend yield is the return earned by share through dividends

gains yield is another return earned by share through appreciation in its price in the market place-stock exchange

Total return on return on share is the sum of both.

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If the consumer price index was 170 in one year and 180 in the next year, then the rate of inflation is approximately:
aliina [53]
Well the answer is quite easy just count From 170 to 180 and that leaves u with 10 so ur answer is ten
8 0
3 years ago
Read 2 more answers
A firm wishes to maintain an internal growth rate of 8 percent and a dividend payout ratio of 36 percent. The current profit mar
Anon25 [30]

Answer:

2.16 times

Explanation:

Given that,

Internal growth rate = 8 percent

Dividend payout ratio = 36 percent

Current profit margin = 5.8 percent

Therefore,

Internal Growth Rate = (1 - Dividend Payout Ratio) × ROA

8% = (1 - 36%) × ROA

0.08 = 0.64 × ROA

ROA = 0.08 ÷ 0.64

        = 0.125

ROA = Profit Margin × Total Asset Turnover

0.125 = 0.058 × Total Asset Turnover

Total Asset Turnover = 0.125 ÷ 0.058

                                   = 2.16 times

6 0
3 years ago
If a country's money supply is $10 million, and there is only one bank where all of the people deposit their money. If the bank
Luden [163]

Answer:

The money multiplier of the economy is 20

Explanation:

Money multiplier is the term of economics which is defined as the maximum amount, the money supply could rise grounded on the increase in the reserve in the system of banking.

The formula used for computing the money multiplier is as:

Money Multiplier = 1 / r

where

r is the reserve ratio that is 5%

So, putting the same value above:

Money Multiplier = 1 / 5%

Money Multiplier = 20

7 0
3 years ago
management's refusal to let workers enter a plant or building to work is a: question 25 options: 1) boycott 2) reverse strike 3)
BigorU [14]

Management's refusal to let workers enter a plant or building to work is option 4) lockout.

A lockout is a state of affairs during which employers shut an area of labor and stop employees from coming into it till the employees settle for the employer's new proposals on pay or conditions of labor. [business] The opposition might resume if no new contract agreement is signed.

Strike action, conjointly referred to as labor strike, labour strike, or just strike, may be a job action caused by the mass refusal of workers to figure. A strike typically takes place in response to worker grievances. Strikes became common throughout the commercial Revolution, once mass labor became vital in factories and mines.

To learn more about lockout here

brainly.com/question/28171151

#SPJ4

4 0
1 year ago
What is a cancelled check?
melisa1 [442]

Answer:

Explanation:

A cancelled check is a check payment for which the stated amount of cash has been removed from the payer's checking account. Once the cash draw down is completed, the bank stamps the check as cancelled. ... Paid by the drawee bank to the payee bank. Cash is paid into the payee's account by the payee bank

3 0
3 years ago
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