Answer:
A) Outsourcing
Explanation:
Outsourcing is sourcing labor and talent internationally rather than domestically.
Answer:
Intrinsic value is $114.30
Explanation:
Given:
Dividend paid = $8
Required rate of return = 7% or 0.07
There is no growth in dividends.
Calculate price of preferred share using DDM as shown below:
Price of preferred share = Dividend paid ÷ Required rate of return
= 8 ÷ 0.07
= $114.28 or $114.3
Therefore, price of preferred share is $114.30
Answer:
b. the equity method.
Explanation:
The equity method is used when the investor company will own approximately 20% to 50% of the common stock of the investee company. This method is used because the investor company will have significant influence over the actions taken by the investee company. The investee company will generally be considered an affiliate company, but not a subsidiary.