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sashaice [31]
3 years ago
13

Stockbridge Sprockets Inc. earned $2.25 per share last quarter, and $2.50 in the last quarter of 2019. Because of declining dema

nd for sprockets, analysts’ consensus estimates for the company for this quarter are $1.90 per share. If the company’s actual earnings announcement is $2.00 per share, absent any other news, what could the price of the stock be expected to do following the announcement?
A. Go up
B. Go down
C. Go either up or down
D. Remain unchanged
E. There is nothing in the data provided that would cause the stock price to move
Business
1 answer:
pochemuha3 years ago
4 0

Answer:

A. Go up

Explanation:

The actual earnings was more than the analysts' estimate. It is a positive surprise to the market. So, the stock price goes up all else being equal.  The stock price goes up, not down , hence Option B is incorrect. Option C is incorrect because all else being equal, the stock price goes up . Also, the stock price does not remain unchanged, it goes up  hence Option D is incorrect. Lastly, there is sufficient data to say that the stock price goes up when there is a positive surprise hence Option E is incorrect.

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Which of the following is true regarding the contribution margin ratio of a company that produces only a single product? Multipl
Artist 52 [7]

Answer

The contribution margin ratio multiplied by the selling price per unit equals the contribution margin per unit.

Explanation:

What happens to the contribution margin ratio of a company that produces only a single product is that the contribution margin ratio multiplied by the selling price per unit equals the contribution margin per unit

5 0
3 years ago
The Security Market Line (SML) shows the relationship between stocks' required rates of return (measured on the vertical axis) a
natka813 [3]

Answer:

True

Explanation:

The reason is that the straight line equation is used to illustrate the relation between the rate of return and the beta factor and is given as under:

Y = a + bX

Here

a = Rf

B = Risk premium = Rm - Rf

X = Beta Factor

So this means the security market line is the graphical presentation of capital asset pricing model and illustrates why the increase in beta factor increases the required rate of return, the reason is that the the overall required return Y of the investment will start increasing with the increase in the beta factor.

So the statement is true.

5 0
3 years ago
Assume Maine Line Railway is considering hiring a reservations agency to handle passenger reservations. The agency would charge
inna [77]

Answer:

$214,000

Explanation:

The total reservation cost per month is given by the following expression:

R = \$14,000+\$1*n

Where 'n' is the number of monthly reservations.

If there are 200,000 reservations for passengers taking a trip next month, the reservation cost is:

R = \$14,000+\$1*200,000\\R=\$214,000

Total reservation cost is $214,000.

7 0
3 years ago
Read 2 more answers
Henry Carr and Noreen Mason formed a partnership, dividing income as follows: annual salary allowance to Carr of $42,000; intere
Evgesh-ka [11]

Answer:

$239,060

Explanation:

The computation of the net income distributed to Carr as follows;

<u> Particulars     Carr      Mason      net income distributed   Non-allocated </u>

Net income                                                                              $442,000

Salary

allowance     $42,000                  $42,000                            $400,000

Interest

on capital     $4,410   $10,290      $14,700                            $385,300

left amount  $192,650 $192,650  $385,300                        $0

Net income  $239,060

8 0
3 years ago
The Fed's Federal Open Market Committee
Juliette [100K]

Answer and Explanation:

d. is the Fed's primary monetary policymaking body.

7 0
3 years ago
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