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damaskus [11]
3 years ago
9

You are considering acquiring a common share of Sahali Shopping Center Corporation that you would like to hold for 1 year. You e

xpect to receive both $1.25 in dividends and $35 from the sale of the share at the end of the year. The maximum price you would pay for a share today is _______ if you wanted to earn a 13% return. A) $32.08 B) $41.67 C) $31.54 D) $30.97
Business
2 answers:
Lelechka [254]3 years ago
7 0

Answer:

A. $32.08

Explanation:

Dividend=$1.25

Capital gain after one year=$35

Rate of return=13%

Formula for this will be;

Share price=(dividend+capital gain)/(1+rate of return)

Share price=(1.25+35)/(1+.13)

Share Price=36.25/1.13

Share price=32.08

VashaNatasha [74]3 years ago
4 0

Answer:

A) $32.08

Explanation:

to determine the maximum amount that we are willing to pay for the stock we can use the present value formula:

present value = future value / (1 + r)ⁿ

  • future value = $1.25 + $35 = $36.25
  • r = 13%
  • n = 1

present value = $36.25 / (1 + 13%)¹ = $36.25 / 1.13 = $32.079 ≈ $32.08

The present value is useful for determining the value of money in time, since $1 today is worth more than $1 tomorrow. It can be solved to determine the future value, interest rate or number of periods.

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Stock Z is trading at $50 today. In one year, the value will go either up to $62.50 or down to $40. A call option on Z with exac
PilotLPTM [1.2K]

Answer:

0.33

Explanation:

Delta = (Cu – Cd)/(Su – Sd)Cu

= 62.50 – 55 = 7.50

Cd = 0

Delta = (7.50 – 0)/(62.50 – 40)

= 0.33

5 0
3 years ago
Designs by Candice is a graphic design studio specializing in logos and business stationery. Candice has just made a $69,300 inv
borishaifa [10]

Answer:

Designs by Candice

Her costs include:

Costs of materials, labor, overheads.  

Then in charging her customers she would include the profit target of $7,623 (representing 11% of her capital investment).

Explanation:

As a graphic design studio, Design by Candice would buy stationery and design materials, including 3D printers and other software.  Candice would also incur labor costs on those doing the design proper.  There are also manufacturing overheads, including rent, utilities, etc. and not to forget other indirect costs like selling and marketing and administrative expenses.

7 0
3 years ago
Southern Hydraulic Supply is undertaking a review of their inventory policies. A typical product is a small hydraulic fitting. C
zheka24 [161]

Answer:

$418,550

Explanation:

Steps are shown below:

a. The computation of the economic order quantity is shown below:

= \sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}

= \sqrt{\frac{2\times \text{52,000}\times \text{\$50}}{\text{\$1.25}}}

= 2,040 units

b. The number of orders would be equal to

= Annual demand ÷ economic order quantity

= $52,000 ÷ 2,040 units

=  25.49 orders

c. The average inventory would equal to

= Economic order quantity ÷ 2

= 2040 units ÷ 2

= 1,020 units

d. The total cost of ordering cost and carrying cost equals to

Ordering cost = Number of orders × ordering cost per order

= 25.49 orders × $50

= $1,275

Carrying cost = average inventory × carrying cost per unit

= 1,020 units × $1.25

= $1,275

So, the total annual cost would be  

= Purchase cost + ordering cost + carrying cost

= $416,000 + $1,275 + $1,275

= $418,550

Purchase cost = Annual demand × cost per unit

                        = 52,000 × $8

                        = $416,000

6 0
3 years ago
Which of the following personal property items has the HIGHEST specific limitation on coverage?
Charra [1.4K]

The personal property items that have the HIGHEST specific limitation on coverage are jewelry, watches, and precious stones or metals because they are saved in a location, especially in banks

<h3 /><h3>The properties having HIGHEST specific limitation on coverage.</h3>

A limit is the highest amount your insurer will pay for a claim that your insurance policy covers.

Some of these specific limits apply to a building or personal property at a single location.

From the listed option, the personal property items that have the HIGHEST specific limitation on coverage are jewelry, watches, and precious stones or metals because they are saved in a location, especially in banks

Learn more on specific limitations on coverage here: brainly.com/question/27015627

8 0
2 years ago
Scott tried to file a police report after being victimized by an identity thief. However, the police department was reluctant to
saul85 [17]

Answer:

Explanation:

if the question is select multiple answers then both A and C. if it is just one answer then A.

7 0
3 years ago
Read 2 more answers
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