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grandymaker [24]
3 years ago
12

The last dividend paid by Wilden Corporation was $1.55. The dividend growth rate is expected to be constant at 1.5% for 2 years,

after which dividends are expected to grow at a rate of 8.0% forever. The firm's required return (rs) is 12.0%. What is the best estimate of the current stock price?a. $37.05b. $38.16c. $39.30d. $40.48e. $41.70
Business
1 answer:
vodomira [7]3 years ago
3 0

Answer: The correct answer is "a. $37.05"

Explanation:

1) 1,55 x (1 + 0,015) = 1.5733 Div1

1,57 x (1+ 0,015) = 1.5968 Div2

1,5968 x (1+0,08) = 1.7246 Div3

2) We use the dividend formula that grows at a "g" rate in perpetuity:

V = 1,7246 / (0,12 - 0,08) = 43.115

So Div2 = 43.115 + 1,5968 = 44,7118

3) We use the Cash Flow function of the financial calculator:

Div0 = 0

Div1 = 1,57

Div2 = 44,7118

i% = 12

Net present value = $37,05

Or we calculate manual = 1.5733 /(1 + 0,12) + (1.5968 + 43.115) / (1+0,12)^2

=$37.05

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Answer:

Secondary data technique is not perfect for marketing research

Explanation:

The secondary method is useful, as it is difficult to perform or conduct a new survey. More, importantly using secondary data technique in marketing research is not an ideal method, because the data may be inaccurate or outdated. The pharmaceutical company was performing marketing research, and usually, the availability of new marketing data is challenging to get from secondary sources.

5 0
3 years ago
A craftsman named William Barnes builds two kinds of​ birdhouses, one for wrens and a second for bluebirds. Each wren birdhouse
Ahat [919]

Answer:

The objective function is to minimize cost thru use of linear programming

Explanation:

A craftsman named William Barnes builds two kinds of​ birdhouses, one for wrens and a second for bluebirds. Each wren birdhouse takes 4 hours of labor and 4 units of lumber. Each bluebird house requires 2 hours of labor and 12 units of lumber. The craftsman has available 72 hours of labor and 120 units of lumber. Wren houses yield a profit of $ 10 each and bluebird houses yield a profit of $ 15 each. The aim of the objective function for William should be to ▼ Minimize Maximize the objective value.

The objective function is to minimize cost thru use of linear programming

3 0
3 years ago
Which of the following statements is​ FALSE? A. According to the constant dividend growth​ model, the value of the firm depends
Vedmedyk [2.9K]

<u>A. According to the constant dividend growth​ model, the value of the firm depends on the current dividend​ level, divided by the equity cost of capital plus the grow rate.</u>

This is the false statement.

<u>Explanation</u>:

The fair value of stock can be calculated using the dividend growth model. While calculating the value of the stock, the growth of the dividends should be considered either in a stable rate or at a different rate during the period at hand.

The dividend growth model is also known as a <u>valuation model</u> as it is used to achieve the value of the stock.

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4 0
3 years ago
The accountant for Walter Company is preparing the company's statement of cash flows for the fiscal year just ended. The followi
Strike441 [17]

Answer:

$25,400

Explanation:

Equity which represents the amount owed to the owners of the business includes retained earnings (which is the accumulation of the net income/loss over the years less dividends paid) and common shares.

The movement in the retained earnings balance may be expressed as

Opening balance + net income - cash dividend paid = closing retained earnings balance

Cash dividend declared - Cash dividend paid =  Cash dividend payable

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Cash dividend paid = $49,000 - $23,600

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7 0
3 years ago
The hourglass model for structuring effective business presentations suggests you should:_______.
mrs_skeptik [129]

Answer:

Begin and end your presentation with motivating context

Explanation:

Just as the hourglass is shaped with a large top, narrow middle and a large bottom. Presentations should start on a general and motivational context.

The middle of the presentation should focus on some details and procedures on how to achieve set goals and objectives of the topic. This is where practical steps are given to the audience.

The end of the presentation should again be a motivational context again. The audience is made to see the big picture of the situation.

6 0
3 years ago
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