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satela [25.4K]
3 years ago
6

To estimate the value of a nonconstant growth stock, we can estimate the value of each dividend during the period of nonconstant

growth, find the PVs of these dividends, find the value of the stock at the horizon date, find the PV of the horizon value, and then sum these PVs to find the value of the stock today. True or false
Business
1 answer:
garri49 [273]3 years ago
3 0

Answer:

The correct answer is True.

Explanation:

The Gordon growth model is a method of valuing a company's share price, using constant growth and discounting the value of future dividends today. Gordon Growth is often known by its English name.

It is a dividend discount model that assumes that the growths that the company will experience are constant. It is based on the theory that the price of a share should be equal to the price of the dividends that the company is going to pay, discounted to its net present value.

If the share price in the market is less than the result obtained by the discounted dividend model, the share is undervalued and therefore, it is recommended to buy. If, on the other hand, the market price is higher than that of the model, it is understood that the share price is too high.

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**ECONOMY**
Karo-lina-s [1.5K]

Answer:a

Explanation:

7 0
2 years ago
Taylor Company had a salaries payable balance of $18,000 on December 31, 2014. During 2015, it paid $50,000 in cash as salaries,
Flura [38]

Answer:

$18,000

Explanation:

Given data  for Taylor Company;

Salaries payable at the beginning of 2015 (end of 2014) = $18,000

Salary expense during the year (2015) = $50,000

Salaries paid during the year = $50,000

Salary payable at end of year (2015) = ?

Let the salary payable at end of year= S

Using the formula

Salaries payable at the beginning of the year + Salary expense during the year - Salaries paid = Salary payable at end of year

$18,000 + $50,000  - $50,000  =S

S = $18,000

Salaries payable as at December 31, 2015 is $18,000.

8 0
2 years ago
A customer has an existing margin account that shows the following:
adell [148]

Answer:

The answer is option C

Explanation:

Long Market Value - Debit = Equity %

$100,000 $60,000 $40,000 40%

If the market value declines to $60,000, the account will now show:

Long Market Value - Debit = Equity %

$60,000  - $60,000 = $0 ( 0% )

Minimum margin is 25% of market value, i.e  25% of $60,000 = $15,000.

Therefore the customer will receive a maintenance call for $15,000.

5 0
3 years ago
Trade Agreement China's total output of goods and services for a given period, including sales through Alibaba, comprise its a.e
almond37 [142]

Answer:

the answer its D) gross domestic product

Explanation:

Why? Each country to be able to have a strong or stable economy produces and sells goods and services through exchanges with other countries, whether in raw material or technology, it means that (PIB) increases and the economy becomes stronger, using international agreements.

4 0
2 years ago
Lithium, Inc. is considering two mutually exclusive projecLithium, Inc. is considering two mutually exclusive projects, A and B.
just olya [345]

Answer:

  • The modified internal rate of return for PROJECT A:

b. 24.18%

  • The internal rate of return for Project B :

b. 35.27%.

Explanation:

The mean difference between the MIRR and the IRR it's that the IRR assumes that the obtained positive cash flows are reinvested at the same rate at which they were generated, while the MIRR considers that these cashflow will be reinvested at the external rate of return, this case 10%.

Project A  Y1             Y2

-$95,000  $65,000   $75,000  

24,18% MIRR  

Project B  -$120,000  

Y 1             $64,000  

Y 2            $67,000  

Y 3            $56,000  

Y 4            $45,000  

TIR 35,27%

4 0
2 years ago
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