Answer:
The maximum that should be paid for the stock today is $8.47
Explanation:
Using the constant growth model of dividend discount model, we can calculate the price of the stock today. The DDM values a stock based on the present value of the expected future dividends from the stock. The formula for price today under this model is,
P0 = D0 * (1+g) / (r - g)
Where,
- r is the required rate of return
P0 = 0.7 * (1+0.016) / (0.10 - 0.016)
P0 = $8.466666667 rounded off to $8.47
Answer:
D) Higher taxes
Explanation:
By increasing the taxes and reducing the spending it will reduce the demand in the economy (the goverment spending will be lower wehile the indivbiduals will have less disposable income as taxes increase)
If the economy was healty enought will lead to economic growth and reduce inflationary pressures.
If the country face a high inflation and negative growth, would end up with lower income and higher unemployment. Thus damaging to the economy without solving the inflation problem.
Answer: The correct answer is "c. bounded rationality".
Explanation: Jacob's decision is an example of bounded rationality, because according to the theory of limited rationality, people make decisions only partially in a rational way because of our cognitive, information and time constraints.
Explanation:
Memo
To,
Attorney
Respected Sir,
I hope that you are fine. I have been approached by a client who wants to purchase a small business and she wants to seek support of an attorney as well for the legal protection of her business deal. However she is a bit reluctant to hire more people as she has a very limited budget and might not pay you beyond her budget. She also wants to settle the deal as soon as possible.
I have seen her case and there is margin in overall deal price. She is paying to the seller a bit more than market situation, so here is a solution that I propose.
Mr Attorney; you get in with her on the deal to provide your services and in return whatever discount we can bargain from the deal, would be shared with you also as your fees. Since the client is willing to pay early, so once the deal is done you can get your fee also.
Hope to hear from you soon on this.
Regards,
XYZ enterprise
A perfectly competitive firm and a monopolistic firm in the long-run equilibrium face exactly the same demand and cost curves, then they will also <u>earn zero </u><u>economic profits</u><u>, and attain the lowest possible unit costs (D).</u>
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Economic profit is the total revenue minus the total cost of a product produced by a firm. Cost in this term include the measurement of oppotunity cost.
Perfectly competitive firm is a firm in a market with many buyers and sellers and the price of products represents the equililbrium point between supply and demand. A firm in this market has almost no power to affect the product price.
In the long-run, a perfectly competitive firm will earn 0 (zero) economic profit, while earn accounting profits. This condition happens because entry and exit barriers for firms in perfect competitive market is low. Many firms can easily enter and exit the market.
Monopolistic firm is a firm in a market where many firms are producing similar but differentiated products. The entry barriers for thiis market is relatively low and the decisions of any firm do not dirrectly affecting its competitor within the market.
In the long-run, monopolistic firm will earn zero economic profits because the low entry barriers easily allows new competitors to join the market and reduce an old-player firm's demand. This condition push a firm to make its demand curve to be more elastic. Any change in the demand curve will also affecting a firm's marginal revenue curve as well. This situation then leads a firm to no-longer make an economic profit condition.
However, to ensure their sustainability in their respective markets, both firms will attain the lowes possible unit costs to earn accounting profits.
Learn more about Perfect Competition and Monopolistic Markets here: brainly.com/question/29454493
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