Answer:
20.2 or 20.2:1
Explanation:
EPS = Net Income / common shares outstanding
EPS = $885,000 / 177,000 shares
EPS = $5
Market price per share = $101
Price-earnings ratio = Market price per share / EPS
Price-earnings ratio = $101 / $5
Price-earnings ratio = 20.2 or 20.2:1
The value of each company's shares of stock
Red: $91.25
Yellow:$52.14
Blue: $36.50
Step 1
The constant dividend growth model, which is written as
Pt = Dt (1 + g)/(R - g)
<h3>Step2</h3>
Therefore, the current stock price for each company is:
Price of the red stock is $3.65/(0.08 -0.04) = $91.25.
Price of the yellow stock is $3.65/(0.11 -0.04) = $52.14.
Price of the blue stock is $3.65/(0.14 -0.04) = 36.50.
The stock price falls as the needed return rises. A greater discount rate reduces the present value of cash flows, which is a function of the time value of money. The stock price can be significantly affected by even slight changes in the needed return, which is another crucial point to remember.
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Answer:
(D) global information
Explanation:
A global information system is an information system which is used in a global context. and deliver the totality of measurable data worldwide within a defined context.
Examples
Systems developed for multinational users, SAP, Oracle ,JDE, are a global ERP system
Global Information Systems for Education
Answer: ( C ) Health care spending accounts
Explanation: All of the following are automatic stabilizers, except: Health care spending accounts.
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Answer:
Required rate of return= 16%
Stock price= $13.50
Explanation:
A share of BAC common stock just made a dividend payment of $1
Market return is 12%
Beta is 1.5
Risk-free rate is 4%
Growth rate is 8%
The required rate of return for the stock can be calculated as follows
Required rate of return= Risk-free rate+beta×(market rate-risk-free rate)
= 4%+1.5(12%-4%)
= 4%+1.5×8%
= 4%+12
= 16%
The stock price can be calculated as follows
Stock price= dividend for the year/(rate of return-growth rate)
= (1×1.08)/(16/100-8/100)
= 1.08/0.16-0.08
= 1.08/0.08
= $13.50
Hence the required rate of return and the stock price is 16% and $13.50 respectively.
