1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Alexus [3.1K]
3 years ago
11

The Havard Heating Company has been very successful in the past four years. Over these years, it paid common stock dividend of $

4 in the first year, $4.15 in the second year, $4.35 in the third year, and its most recent dividend was $4.58. The company wishes to continue this dividend growth indefinitely. What is the value of the company's stock if the required rate of return is 10 percent
Business
1 answer:
Snowcat [4.5K]3 years ago
3 0

Answer:

$102.34

Explanation:

to be able to use the Gordon growth model, we must first determine the growth rate:

(4.15 - 4) / 4 = 3.75%

(4.35 - 4.15) / 4.15 = 4.82%

(4.58 - 4.35) / 4.35 = 5.29%

we can assume that the company will expect the growth rate to be 5.29%

stock price = (dividend + growth rate) / (required rate of return - growth rate)

= ($4.58 x 1.0529) / (10% - 5.29%) = $4.82 / 4.71% = $102.34

You might be interested in
Assets are 300,000 and equity is 100,000, assets increase 80,000 liabilities increase 50,000. what is equity at year end?
mojhsa [17]
<span>Assets - equity = liabilities
  So liability before the increase is:
 300, 000 - 100, 000 = 200, 000
 And if assets increases by 80, 000. Hence new assets = 380, 000. Liabilities increases by 50, 000; hence new liability = 250, 000.
 New Equity = New Assets - New liability.
 New Equity = 380, 000 - 250, 000 = 130, 000.</span>
6 0
3 years ago
A $63,000 machine with a 7-year class life was purchased 2 years ago. The machine will now be sold for $50,000 and replaced with
Lapatulllka [165]

The initial outlay for the project after depreciation is loss of $26,700.

<h3>What is  depreciation?</h3>

Depreciation in accounting refers to two parts of the same concept: first, the real decline in fair value of an asset, such as the worth of factory equipment each year.

Depreciation is used to match the cost of a productive asset with a useful life of more than a year to the revenues received by employing the asset. The expense of an asset is frequently spread out throughout the years that it is used.

Section 32 of the Income Tax Act of 1961 contains the provision for authorising depreciation. Depreciation is a deduction allowed by the Income Tax Act for the reduction in the real worth of a physical or intangible asset used by a taxpayer.

To know more about  depreciation follow the link:

brainly.com/question/1203926

#SPJ4

8 0
1 year ago
Suppose the production function in medieval Europe is Y 5 K 0.5L0.5, where K is the amount of land and L is the amount of labor.
Sonbull [250]

Answer:

a) Y = 500

b) Wages: 2.5

   Rental price: 2.5

   

c) labor Share of output: 0.370511713 = 37.05%

Explanation:

Y = 4K^{0.5} \times L^{0.5}

if K = 100 and L = 100

Y = 5(100)^{0.5} \times (100)^{0.5}

Y = 50 \times 10

Y = 500

wages: marginal product of labor = value of an extra unit of labor

dY/dL (slope of the income function considering K constant while L variable)

ax^b = bax^{b-1}

Y = 5K^{0.5} \times L^{0.5}

Y' = 5K^{0.5} \times 0.5 L^{-0.5}

Y' = 2.5K^{0.5} \times L^{-0.5}

Y' = 2.5(\frac{K}{L})^{0.5}

With K = 100 and L = 100

Y' = 2.5(\frac{(100)}{(100)})^{0.5}

Y' = 2.5

rental: marginal product of land = value of an extra unit of land

dY/dK (slope of the income function considering K variable while L constant)

Y = 5K^{0.5} \times L^{0.5}

Y' = 2.5K^{-0.5} \times L^{0.5}

Y' = 2.5(\frac{L}{K})^{0.5}

L = 100 K = 100

Y' = 2.5(\frac{100}{100})^{0.5}

Y' = 2.5

c) we use logarithmic properties:

Y = 50 \times 10

log500 = log(50 \times 10)

log500 = log50 + log10

50 was the land while 10 the labor

2.698970004 = 1.698970004 + 1

share of output to labor: 1/2.698970004  = 0.370511713

5 0
3 years ago
When making a payment of FUTA taxes, the employer must make the payment by the: a.10th of the month after the quarter. b.end of
Murljashka [212]

Answer:

Correct option is D.

<u>End of the month after the quarter.</u>

Explanation:

FUTA taxes must be paid quarterly by the last day of the month following the end of the calendar quarter.

  • April 30th
  • July 31st
  • October 31st
  • January 31st
5 0
2 years ago
Spacefood Products will pay a dividend of $ 2.25 $2.25 per share this year. It is expected that this dividend will grow by 3 3​%
gavmur [86]

Answer:

$32.14 per share

Explanation:

The computation of the current value of the single share is shown below:

= Current year dividend ÷ (Required rate of return - growth rate)

where,

Current year dividend is $2.25 per share

Required rate of return is 10%

And, the growth rate is 3%

So by placing these items, the current value is

= $2.25 ÷ (10% - 3%)

= $32.14 per share

7 0
2 years ago
Other questions:
  • Bernice’s has $823,000 in sales. The profit margin is 4.2 percent and the firm has 7,500 shares of stock outstanding. The market
    6·1 answer
  • According to Sullivan, which of the following happens in stressful situations?
    13·2 answers
  • The purpose of advertising is _____. to convince consumers that they can benefit from a product or service to entertain consumer
    7·1 answer
  • Suppose the most you would be willing to pay to have a freshly washed car before going out on a date is $4.00. The smallest amou
    14·2 answers
  • 5. Which of the following potato dishes is an example of multiple-stage
    13·1 answer
  • Among the advantages of cycle counting is that it: allows more rapid identification of errors and consequent remedial action tha
    6·1 answer
  • listen here lads i need a sonnet about food or cars or sports or video games mainly rocket league o cod
    6·2 answers
  • Historical Art is a new business. During its first year of operations, credit sales were $50,000 and collections from credit sal
    10·1 answer
  • If an advertiser wants to enhance the sales of a specific good or service, institutional advertising should be used. Select one:
    8·1 answer
  • Hello everyone today is the 28 and I hope you are getting some with your school and approving I wanted to reach out to you that
    10·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!