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Liula [17]
3 years ago
10

Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $2.40 a share. The company has promised to

maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn a return of 15.70 percent on your equity investments?
Business
1 answer:
Blizzard [7]3 years ago
5 0

Answer:

The maximum amount that should be paid for one share of this stock today is $15.29

Explanation:

The price of a stock which pays a constant dividend forever can be calculated using the zero dividend growth model of the Dividend Discount Model (DDM) approach. The DDM values a stock based on the present value of the expected future dividends from the stock discounted using the required rate of return on stock.

The formula for price under zero growth model of DDM is,

Price today (P0) = Dividend / required rate of return

P0 = 2.4 / 0.1570

P0 = $15.286 rounded off to $15.29

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Answer:

Note: The full question is attached as picture below

                               (a)                   (b)                   (c)  

                                In                                      Larger  

                            Balance      Difference       column

1.                               No               $725             Debit  

2.                             Yes                 NA                NA  

3.                              Yes                 NA                NA  

4.                               No               $225            Credit  

5.                              Yes               $684               NA  

6.                               No                $45             Credit

7 0
2 years ago
The demand for plumbers is the same in country A and country B, but the plumbers in country A earn less than the plumbers in cou
Tpy6a [65]

Answer:The supply of plumbers in country A is greater than the supply of plumbers in country B.

Explanation:

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The supply of plumbers in B is not greater than A and this why B earn more. Productivity refers to measuring the level of outputs in relation to the inputs such labour, capital in production and this does not have impact on wages compare to demand and supply of labour but it's impact is on production.

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3 years ago
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They are considered a buyer in the ordinary course of business.
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