Answer:
Value of company = $982.16
Explanation:
The free cash flow is the cash generated by a company that is not retained and reinvested. It is the cash flow available to all providers of capital . It is available to pay dividend or finance other project
The value of the company would be the present value of its free cash flow discounted at the weighted average cost of capital.
Value of company )year 4= 85/(0.12-0.065) = 1,545.45
Value of company (in year 0) = 1,545.45× 1.12^(-4)= 982.16
Value of company = $982.16 millions
The answer is TRUE
Realism and idealism are divergent <span>schools of thought in international relations </span><span>theory. </span>The development of modern realist theory was as a reaction<span> to a liberal tradition that was labelled by the realists as idealism. Although the idealist themselves do not consider</span><span> their approach as unrealistic, the realists think it is.</span>
Answer: Price of stock at year end =$53
Explanation:
we first compute the Expected rate of return using the CAPM FORMULAE that
Expected return =risk-free rate + Beta ( Market return - risk free rate)
Expected return=6% + 1.2 ( 16%-6%)
Expected return= 0.06 + 1.2 (10%)
Expected return=0.06+ 0.12
Expected return=0.18
Using the formulae Po= D1 / R-g to find the growth rate
Where Po= current price of stock at $50
D1= Dividend at $6 at end of year
R = Expected return = 0.18
50= 6/ 0.18-g
50(0.18-g) =6
9-50g=6
50g=9-6
g= 3/50
g=0.06 = 6%
Now that we have gotten the growth rate and expected return, we can now determine the price the investors are expected to sell the stock at the end of year.
Price of stock = D( 1-g) / R-g
= 6( 1+0.06)/ 0.18 -0.06
=6+0.36/0.12
=6.36/0.12= $53
Answer:
a. education; b. housing; c. transportation; d. food and beverages; e. recreation; f. medical care
Explanation:
CPI or consumer price index represents the costs of basket of goods and services across the country on monthly basis and includes the following categories:
- housing
- apparel
- transportation
- education and communication
- other goods and services
- recreation
- medical care
- food and beverages
a. Education
b. housing
c. transportation
d. food and beverages
e. recreation
f. medical care
With prestige goods and services, a higher price may, but not always, result in a higher sales volume.
<h3>What do economists mean by prestige goods?</h3>
Numerous products and services have prestige value, elevating the standing of their owners or users. Such items are referred to be prestige (or status, or positional) goods. These prestige products include things like jewelry, designer apparel, expensive homes and vehicles, and lavish entertainment.
<h3>Why is the demand curve for prestige items different?</h3>
Prestige goods may actually see an increase in demand as a result of price increases since customers perceive them to be more value. The demand curve slopes upward in certain circumstances.
To know more bout Prestige products visit:
brainly.com/question/6374886
#SPJ4
