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Pepsi [2]
3 years ago
5

Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $31.00 per share. The firm'

s dividend for next year is expected to be $5.30 with an annual growth rate of 7.0% thereafter indefinitely. If the firm issues new stock, the flotation costs would equal 14.0% of the stock's market value. The firm's marginal tax rate is 40%. What is the firm's cost of external equity?
Business
1 answer:
Setler [38]3 years ago
4 0

Answer:

Cost of external equity= 26.9%

Explanation

<em>According to the dividend valuation, the value of a stock is the present value of expected future dividends discounted at the required rate of return.</em>

The model can me modified to determined the cost of equity having flotation cost as follows:

Ke = D(1+r )/P(1-f) + g

Ke= Cost of equity

D- current dividend,

D(1+g) - dividend next year

p- price of stock - 31,00$

f - flotation cost - 14%

g- growth rate - 7%

Ke= 5.30/31× (1-0.14)  +  0.07

 = 0.2687997  × 100

= 26.9%

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g "Walblue imports a desk from a French manufacturer for sale in its chain of U.S. stores. The cost of a desk to Walblue is 3,70
klasskru [66]

Answer: $3312.4

Explanation:

The exchange rate in the rate at which a currency is being converted for another currency in the foreign exchange market. From the question, we are told that Walblue imports a desk from a French manufacturer for sale in its chain of U.S. stores.and that the cost of a desk to Walblue is 3,700 euros (€).

The dollar cost of one of these desks if the exchange rate is currently 1.117 euros per U.S. dollar goes thus:

$1 = €1.117

Therefore, €3700 will be converted to dollars as:

= 3700/1.117

= $3312.4

The answer is $3312.4

7 0
2 years ago
Decision support systems ____.a.might support a decision maker in only one or two of the problem-solving phases support optimiza
____ [38]

Answer:

all of the above

Explanation:

<u>Decision support systems</u> is a computer system that uses information systems. <em>The main objective</em> of this program is to assist in organizational decision making. To be enabled for this function, the system operates using a large amount of data, which converts information and compiles the most relevant information to provide existing alternatives that assist the effective decision making process.

4 0
3 years ago
Question 17
katovenus [111]

Answer:

B. List Operational Costs

Explanation:

3 0
3 years ago
Alex was sent to Beijing to help local managers solve the problem of growing worker dissatisfaction at their manufacturing facil
Ilya [14]

" There is an unequal distribution of power in the company " best explains this situation

Explanation:

Inequity is the almost inevitable result of two strong forces:

human bias and socioeconomic injustice.

One may debate whether or not power imbalances and other social inequalities induce bias.

(Even though the notion of a single variable approach to these debates encourages most of us, the truth is more complex; each one strengthens the other and this always results in a chicken and egg debate.)

Unfairness and discrimination can also be found interchangeably with everyday terminology.

I presumption a difference here: the definition of the word 'inequality' and the control of the expression 'inequity.' Inequality contributes to the allocation of such products, some of which earn more than others. Inequity stretches into this: not just unequal allocation; disproportionate and unjust allocation.

8 0
3 years ago
Mohit, an assembly line worker, had applied for a position in the production department of a food manufacturing company. During
lozanna [386]

Answer:

psychomotor test

Explanation:

Since the test enabled the examiners to test Mohit's hand–eye coordination and arm–hand steadiness. In this scenario, Mohit most likely took a psychomotor test.

<u>Psychomotor is the relationship between cognitive functions and physical movement. Psychomotor learning is demonstrated by physical skills such as movement, coordination, manipulation, dexterity, etc</u>

<u>Psychomotor test has to do with the origination of movement in conscious mental activity. </u>

<u />

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3 years ago
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