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
Flura [38]
3 years ago
5

A firm is planning on increasing its annual dividend by 3.50% a year in perpetuity. The company just paid its annual dividend in

the amount of $.20 per share. What is the current value of one share of this stock if the required rate of return is 15.50%?a) $2.04b) $1.67c) $1.73d) $1.34
Business
1 answer:
uysha [10]3 years ago
5 0

Answer:

c.) $1.73

Explanation:

Price = \frac{D0(1+g)}{(r-g)}

D0= Last dividend paid

r= rate of return

g = growth rate

Price = \frac{0.20(1.035)}{(0.1550-0.035)}

Price = 0.207 / 0.12

Price = 1.725

Therefore, the current value of the stock is $1.73

You might be interested in
What was the first great economic analysis of global trade written in 1776??
sasho [114]
"An Inquiry into the Nature and Causes of the Wealth of Nations", or "The Wealth of Nations", written by Scottish economist and philosopher Adam Smith. One of the first collected descriptions of what builds a nation's wealth. Written at the beginning of the Industrial Revolution, it covers division of labour, productivity and free markets. Took 10 years to write with reference to 17 years of notes, based off of observations about economic and societal conditions. Offered more practical information for the time to replace mercantilist and physiocratic theories.
7 0
3 years ago
What do administrative support careers do? Name three tasks.
ANTONII [103]
1.Computer software
2.Operate fax machines
3.Answer routine letters and email

4 0
3 years ago
Read 2 more answers
Clever Computers has a five-day workweek and pays the office staff $3,050 each week. If the month ends on a Thursday, the adjust
Oksana_A [137]

Answer: The correct answer is b.$3,050.

Explanation: Clever Computers has a five-day workweek and pays $3,050 each week. The payment will only occur at the end of the workweek when the staff have earned the wages. However, the month ended on Thursday, meaning that the staff have only worked for four-day workweek. They have therefore earned $2,440 (4/5*$3,050) at the end of the month but that payment is not due because the 5-day workweek has not been completed. The complete journals the company would raise would be Debit Wages (overhead) $2,440, Debit Wages receivable $610 and Cr Wages payable $3,050.

When it is next month after the five-day workweek has been completed, the company would Dr Wages Payable $3,050 and Credit Cash $3,050 to make the payment.

4 0
3 years ago
One ethical dilemma that multinational firms must face is
Oksi-84 [34.3K]

Answer:

Bribery

Explanation:

they must decide whether to pay bribes or find alternative sources of supplies

7 0
3 years ago
In october 2014, facebook, inc. acquired 100 percent of the common stock of whatsapp, inc. by paying $4,473 million of cash and
Nataly [62]
Lol bruh who uses Facebook anymore XD
8 0
3 years ago
Other questions:
  • Anita wants to encourage her classmates to read their textbooks thoroughly. to support her point, she says, "some students think
    13·1 answer
  • During the High Middle Ages, the bureaucracies of England and France became increasingly staffed with Select one: a. canon lawye
    5·1 answer
  • Alpha can produce either 18 oranges or 9 apples an hour, while Beta can produce either 16 oranges or 4 apples an hour. If the te
    14·1 answer
  • An article in the Wall Street Journal discussed the views of Canadian Minister of Finance Joe Oliver on the effect of falling oi
    8·1 answer
  • Greer Manufacturing purchases property that includes land, buildings and equipment for $4.7 million. The company pays $185,000 i
    14·1 answer
  • In Canada, the average worker can produce 10 computers or six cars a year. In the United States, the average worker can produce
    12·1 answer
  • Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 22 percent for the next three years, with the growth
    6·1 answer
  • Explain how money market accounts differ from regular savings accounts.
    9·1 answer
  • Here are comparative statement data for Duke Company and Lord Company, two competitors. All balance sheet data are as of Decembe
    14·1 answer
  • Oriole Company uses a periodic inventory system. Details for the inventory account for the month of January 2017 are as follows:
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!