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natta225 [31]
3 years ago
6

Clovix Corporation has $50 million in​ cash, 10 million shares​ outstanding, and a current share price of $30. Clovix is decidin

g whether to use the $50 million to pay an immediate special dividend of $5.00 per​ share, or to retain and invest it at the​ risk-free rate of 10% and use the $5.00 million in interest earned to increase its regular annual dividend of $0.50 per share. Assume perfect capital markets. a. Suppose Clovix pays the special dividend. How can a shareholder who would prefer an increase in the regular dividend create it on her​ own? b. Suppose Clovix increases its regular dividend. How can a shareholder who would prefer the special dividend create it on her​ own?
Business
1 answer:
MatroZZZ [7]3 years ago
7 0

Answer:

a. Assuming an investor prefers the extra $0.50 per year, then he/she can invest the $5 received as special dividend and earn $0.50 himself/herself in the same or similar risk free investment.

b. If the investor needed or wanted the $5 instead of $0.50 extra per year, he/she can borrow the $5 and use the extra $0.50 per year to pay the interests on the loan.

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Producer surplus equals a. Value to buyers - Costs of sellers. b. Amount received by sellers - Costs of sellers. c. Value to buy
aev [14]

Answer:

Amount received by sellers - Costs of sellers. 

Explanation:

Producer surplus is the difference between the price of a good and the cost to sellers. It is the difference between price and the least amount sellers would be willing to sell their products.

Consumer surplus is the difference between the price at which the consumer values the good and the price of the good.

Consumer surplus = Value to buyers - Amount paid by buyers.

I hope my answer helps you

5 0
3 years ago
You plan to retire at age​ 65, and you want to have enough money in your savings account to withdraw​ $54,000 every year for 20
leonid [27]

Answer

The answer and procedures of the exercise are attached in the following archives.

Step-by-step explanation:

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

3 0
3 years ago
Rowdy's Restaurants cash flow (in millions) Cash received from: Customers $4,200 Interest on investments 360 Sale of land 260 Sa
uranmaximum [27]

Answer:

$440 millions

Explanation:

The computation of the net cash inflows (outflows) from operating activities is shown below:

Cash flow from Operating activities  

Cash received from Customers $4,200

Interest on investments $360

Less: Cash paid

Interest on debt -$460

Income tax -$240

Purchase of inventory -$2,600

Operating expenses -$820

Net Cash flow from Operating activities         $440 millions

8 0
3 years ago
The net of a triangular prism is shown below.
harkovskaia [24]

The perimeter is the sum of all three sides of the triangle. In this case it is 18.

<u>Explanation:</u>

In geometry, a triangular crystal is a three-sided crystal; it is a polyhedron made of a triangular base, a deciphered duplicate, and 3 faces joining comparing sides. A privilege triangular crystal has rectangular sides, else it is angled.

A triangular prism has two triangular bases and three rectangular sides and is a pentahedron since it has five countenances. Outdoors tents, triangular rooftops and "Toblerone" wrappers - chocolate pieces of candy - are instances of triangular prisms.

6 0
3 years ago
What Is One Reason Why Inflation Can Occur
GrogVix [38]

Answer:

Both types of inflation cause an increase in the overall price level within an economy. Demand-pull inflation occurs when aggregate demand for goods and services in an economy rises more rapidly than an economy's productive capacity.

Explanation:

8 0
3 years ago
Read 2 more answers
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