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Helen [10]
3 years ago
7

Brevik Builders has an expected ROE of 25%. Its dividend growth rate will be __________ if it follows a policy of paying 30% of

earnings in the form of dividends. A. 5% B. 15% C. 17.5% D. 45%
Business
1 answer:
Tems11 [23]3 years ago
6 0

Answer: C. 17.5%

Explanation:

The Return on Equity can be calculated by the formula;

ROE = Growth rate / (1 - dividend payout ratio)

25% = Growth rate / ( 1 - 30%)

Growth rate = 25% * 70%

Growth rate = 17.5%

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Billy Bob's Barber Shop knows that a 5 percent increase in the price of their haircuts results in a 15 percent decrease in the n
Gala2k [10]

Answer:

Option (B) is correct.

Explanation:

Given that,

Percentage increase in price = 5%

Percentage decrease in quantity demanded = 15%

Therefore,

Elasticity\ of\ demand=\frac{percentage\ change\ in\ quantity\ demanded}{percentage\ change\ in\ price}

Elasticity\ of\ demand=\frac{15}{5}

                                           = 3.0

Hence, elasticity of demand facing Billy Bob's Barber Shop is 3.0

6 0
3 years ago
Who controls the supply for coffee shops and based on what factors
andrezito [222]

Answer:

Explanation:

Market prices control the supply for coffee shops, not only that but also it is also affected by other factors with things like: price of inputs, and how much it cost to make, and technology developments

3 0
3 years ago
Acme Investors is considering the purchase of the undeveloped Baker Tract of land. It is currently zoned for agricultural use. I
Ahat [919]

Answer:

Office

Explanation:

Calculation to determine Which would be the highest and best use of this site

The analysis for the Baker Tract is as follows: OFFICE RETAIL

Rent 2,400,000 2,400,000

(100,000*$24=2,400,000)

Less Expenses (960,000) (1,200,000)

(2,400,000*40%=960,000)

(2,400,000*50%=1,200,000)

Cash Flow 1,440,000 1,200,000

(2,400,000-960,000=$1,440,000)

(2,400,000-$1,200,000=$1,200,000)

Cap Rate 0.10 0.11

(13%-3%=0.10)

(14%-3%=0.11)

Property Value 14,400,000 10,909,090

(1,440,000/0.10=14,400,000)

(1,200,000/0.11=10,909,090)

Construction Cost (10,000,000) ( 8,000,000)

(100,000*100=10,000,000)

(80,000*100=8,000,000)

Residual 4,400,000 2,909,090

(14,400,000-10,000,000=4,400,000)

( 10,909,090-8,000,000=2,909,090)

Therefore Based on the above calculation OFFICE would be the highest and best use of this site reason been that OFFICE has the HIGHEST amount of $4,400,000 compare to retail which has $2,909,090.

6 0
2 years ago
Which one of these statements related to discounted payback is correct?a) the discounted payback period decreases as teh discoun
Free_Kalibri [48]

Answer:

A) the discounted payback period decreases as the discount rate increases

Explanation:

The discounted payback period is used to determine the profitability of an investment project.

A not discounted payback period is how long does it take for the cash flows of a project to recoup the investment's cost without considering the value of money in time. By applying a discount to the cash flows, the discounted period will more accurately measure the length of time needed to recoup an investment using current dollars.

The higher the discount rate, the longer it will take for the cash flows to cover the investment's cost, so if the discount rate lowers, then the discounted payback period will be shorter.

5 0
3 years ago
Strategic management is defined as
forsale [732]
Creation and execution of goals by the management team, defined by available resources and existing conditions in and out of the company.
4 0
3 years ago
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