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PSYCHO15rus [73]
3 years ago
15

The Drogon Co. just issued a dividend of $3.00 per share on its common stock. The company is expected to maintain a constant 6.2

percent growth rate in its dividends indefinitely. If the stock sells for $60 a share, what is the company’s cost of equity? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places.
Business
1 answer:
Mars2501 [29]3 years ago
5 0

Answer:

The company’s cost of equity is 11.51%.

Explanation:

Please find the below for detailed explanations and calculations:

The company's cost of equity need to be found is the discounted rate that will bring net present value of its projected future dividend to its current stock price.

Denote cost of equity need to be found is x.

We apply the formula to calculated the present value of growing perpetuity to find x as shown below:

[ 3 x ( 1+0.062) ] / ( x - 0.062) = 60 <=> 3.186 / ( x - 0.062) = 60 <=> x = 11.51%.

Thus, the company's cost of equity is 11.51%.

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The answer is option C. She may immediately sell the bonds but it is unclear how much money they will sell for.

Explanation:

She may immediately sell the bonds but it is unclear how much money they will sell for.

Investors who hold onto their bonds until maturity are assured of to receive the face value of the bond. In our case, if Andrea would have chosen to hold her $5,000  bond investment for 10 years, she would have been assured the  bonds face value, however since she prefers to use the cash to work abroad, she can sell the bonds immediately.

Selling a bond before it's maturity date can either be beneficial or detrimental. This depends on the value of the bond at the time of sale. If at the time of sale the bond would have gained value, then the bond will sell at a higher price than when it was bought. On the other hand, if the bond at the time of sale has lost value, then the bond will sell at a lower price than the price which it was bought.

In our case, the best option for Andrea would be to sell the bonds immediately, since she really needs the cash. If it happens that at the point at which she sells the bonds they will have gained value, then she will have more than $5,000 cash, however, if at the point she decides to sell the bonds they will have lost value, then she will have less than $5,000 depending on how much value was lost from the time she bought the bonds and the time she sold the bonds.

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3 years ago
In a _______ organization lower-level managers are empowered to make decisions which can ________ motivation and job satisfactio
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The correct answer is B

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So, in a organization or company which is decentralized where lower level managers are empowered for taking a decision leads to increase in the motivation as well as the job satisfaction of the employees.

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Main memory divided into a number of static partitions at system generation time is _______ .
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The main memory divided into a number of static partitions at system generation time is fixed partitioning.

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The principal internal storage area in a computer, sometimes known as RAM, is the main memory (random access memory). Specs like 4GB, 8GB, 12GB, and 16GB usually invariably relate to the RAM's storage capacity. On the other hand, a computer's disk or solid-state storage capabilities are commonly 128GB or 256GB or greater.

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LO 4.3From beginning to end, place these items in the order of the flow of goods.
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Answer:

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Explanation:

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so order of the flow of goods from beginning to end is

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