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Reptile [31]
3 years ago
7

Caspian Sea Drinks needs to raise $26.00 million by issuing additional shares of stock. If the market estimates CSD will pay a d

ividend of $2.46 next year, which will grow at 4.65% forever and the cost of equity to be 10.24%, then how many shares of stock must CSD sell?
Business
2 answers:
wel3 years ago
7 0

Answer:

CSD must issue 590 775 sharesof stock

Explanation:

The market value of any firm is given by number of shares multiplied by the stock price so in this case we want $26 mil we nees number of shares the given information D1 $2.46, g 4.65% and r 10.24% will help us get the stock price in which will help in getting the exact number of shares to be issued

We will use the Gordon Growth Model to calculate the stock price

SP = D1/r -g

     =2.46/ 0.1024-0.0465

      =$44.01

Goal raise $26mil

26000000=stock price * number of share

26000000=44.01*number of shares

number of shares =26000000/44.01=590 775 shares

Explanation:

Klio2033 [76]3 years ago
4 0

Answer:

The number of shares needed to raise $26 miliion will be 590909 shares.

Explanation:

To calculate the number of shares needed to raise $26 million, we first need to findout the price per share at which shares are issued. The fair value or the price per share can be caclculated using the constant growth model of the DDM approach. Thus, the price per share today will be:

P0 = 2.46 / (0.1024 - 0.0465)

P0 = $44.007 rounded off to $44

Thus, at the price of $44 per share, number of shares needed to raise $26 million will be:

No of shares = 26,000,000 / 44  = 590909.0909 rounded off to 590909 shares

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Explanation:

A) install a SEPARATION unit on the output from the reactor and feed the unreacted reagents back to the reactor feed in a RECYCLE stream.

B) Even if one had a perfect separation unit, the 65% or reactant which went to undesirable side reaction is wasted. Recycle is not effective to help poor selectivity of the reactor.

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3 years ago
Imagine an influential new study shows that eating eggs drastically reduces the risk
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Consider a mutual fund with $203 million in assets at the start of the year and with 10 million shares outstanding. The fund inv
balu736 [363]

Answer:

8.66%

Explanation:

The computation of the rate of return for the investor in the fund is as follows:

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where,

Net assets at the end is

= $203 million + $203 million × 7% - ($217.21 million × 0.75%)

= $203 million + $14.21 million - $1.6291 million

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Dividend per share is

= $5 million ÷ 10 million shares

= 0.5

Nav at the beginning of the year is

= $203 million ÷ 10 million shares

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Now the rate of return is

= ($215,.58093 + 0.5 - $20.3) ÷ ($20.3)

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6 0
2 years ago
All of the following are functions of a knowledge management system EXCEPT: a. designing information systems. b. improving colla
Alika [10]

Answer:

designing information systems

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7 0
3 years ago
PLEASE HELP ME
zhuklara [117]
<span>A. Connecticut Community College</span>
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3 years ago
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