Answer:
Value of stock =$100
Value of stock B=$83.33
Value of stock C = $104.51
Explanation:
Stock A
A dividend of $10 a share forever is a perpetuity.
PV of a perpetuity =
where CF is the cash-flow expected per compounding period = $10
ke=return on investment or market capitalization rate=0.1
Value of stock A = =$100
Stock B
Given D1=$5, g = 4% forever- this stream of cash-flows can be valued using the constant growth model where
PV=
where D1 is the dividend expected at the end of year 1 = $5
ke is the return on investment or market capitalization rate = 0.1
g is the growth rate = 0.04
Value of stock B= = $83.33
Stock C
The stock dividends have two distinct growth periods, the 1st 6 years where g= 20% and after that, zero growth
Price of the stock C =
where P6=
Price of the stock C =
= =$104.51
Stock C is more valuable as it has a higher present value of cash flows.
Answer:
D: Moderate Price; High Quality.Brand
Explanation:
Since in the given question, there are five brands which are based on the sales reports and the customer feedback
And, for visualizing of each rate based on moderate price i.e reasonable price which is between the high price and the quality-price plus it also focuses on the high-quality brand.
Hence, the option D is correct
The answer would be that the company can keep costs too a minimum.
Answer:
a.Canada has a comparative advantage over other countries and Canada will export wheat.
Explanation:
In the case when the domestic price is less than the world price of wheat so it is shown that there is the comparative advantage over the other countries due to this the canada would export the wheat. Also the demand is less or the supply of the wheat is higher. So ultimately it decrease the opportunity cost of generating the wheat
Therefore the above represent the answer
Answer:
c.$37,737
Explanation:
Present value of Cost of Buying = The Cost of Press + [(Post Tax annual maintenance expenses - Annual Depreciation Tax shield)*PVIFA (6%,10)] - [Post tax Salvage Value*PVIF (12%,10)]
PV of Cost of Buying = 360000 + (3000*(1-40%)-360000/10*40%)*7.360 - 25000*(1-40%) * 0.322
PV of Cost of Buying = $262,434
Present value of Cost of Leasing = Post tax Lease Payment at the Beginning *(1+PVIFA(6%,9))
PV of Cost of Leasing = $48000*(1-40%)*(1+6.802)
PV of Cost of Leasing = $224,697
Net advantage to leasing = PV of Cost of Buying - PV of Cost of Leasing
Net advantage to leasing = $262,434 - $224,697
Net advantage to leasing = $37,737