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ad-work [718]
3 years ago
11

The risk-free rate of return is 2% and the expected return on the market portfolio is 8%. Oklahoma Oilco has a beta of 2.0 and a

standard deviation of returns of 26%. Oilco's marginal tax rate is 35%. Analysts expect Oilco's net income to grow by 12% per year for the next 5 years. Using the capital asset pricing model, what is Oklahoma Oilco's cost of common stock
Business
1 answer:
solmaris [256]3 years ago
3 0

Answer:

The multiple choices are as follows:

18.6%

14.0%

22.8%

25.0%

The second option is the correct answer,14%

Explanation:

The capital asset pricing asset model formula for computing a firm's cost of equity according to Miller and Modgiliani is given below:

Ke=Rf+Beta*(Mr-Rf)

Rf is the risk free of 2% which is the return expected from zero risk investment such as government treasury bills.

Beta is how risky an investment in a company is compared to similar businesses operating in similar business sector of the company given as 2.0

Mr is the expected return on market portfolio which 8%

Ke=2%+2*(8%-2%)

Ke=2%+2*(6%)

Ke=2%+12%=14%

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Vikki [24]

Answer:

The high road of this part of the bible defines cooperation and continuity in the work setting with ethical behavior.

Explanation:

Beyond just the work environment, value pairs are applied to day-to-day decision-making and to encounters with both the refer squad. It's also a core competency for maintaining the manager 's reputation.

Next, a bit of comparison and context. Morality is not morality. Ethics is a very unique, independently held code of conduct. Morality has a fluidity that varies over time, depending on social and cultural norms. Imagine the reaction to Brittney Spears for a minute when she appeared in the 1960s on Ed Sullivan show.

8 0
3 years ago
A string of length 160cm is cut in to 2 pieces, in the ratio 3:5 <br>find the length of each piece​
blondinia [14]
The pieces will be 3 times something and 5 times something.
3x + 5x = 160
4 0
3 years ago
Mallory Furniture buys two products for resale: big shelves (B) and medium shelves (M). Each big shelf costs $500 and requires 1
Ghella [55]

Answer:

The answer is D

Explanation:

Solution:

Recall that:

Malloy Furniture purchases two products: Big shelves B and Medium shelves M

The cost of big shelf is =$500

The space required = 100 cubic feet

The cost of each medium shelf is =$300

Storage space = 90 cubic feet,

Now,

Since the values 100 and  90 is greater than 18000 cubic feet available for storage, what is required would be 100 big shelves and 100 medium shelves

5 0
3 years ago
Goodell Corporation just paid its annual dividend of $1.75, today. Dividends for the Goodell Corporation are expected to increas
AlekseyPX

Answer:

current price of Goodell Corporation stock is $48.26

Explanation:

given data

annual dividend = $1.75

expected to increase 1 year = 27.5 percent

expected to increase 2 year = 13.8 percent

expected to increase per year = 5 percent

required rate of return = 10 percent

solution

we get here first dividend that is

D1 = 1.75 × (1.275) = 2.23    ...............1

D2 = 2.23 × (1.138) = 2.54    ...............2

D3 = 2.54 × (1.05) = 2.67      ...............3

and

year 2 price will be

P2 = D3 ÷ (R – g)    ...............4

P2 = 2.67 ÷ (0.10 - 0.05)

P2 = 53.4     ...............5

so current price will be

P = 2.23 ÷ (1.10) + 2.54 ÷ (1.10)2 + 53.40 ÷ (1.10)2

P = $48.26

4 0
3 years ago
Which of the following would not be an operations maangement function in a fast food restaurant?
iVinArrow [24]

Answer:

b. advertising and promotion

Explanation:

All process required to produce the product are part of operation and this includes making, designing the layout of the facility, purchasing ingredients an maintaining equipment.

The marketing and promotions lies with the Sales and Distribution Function or Marketing Function of the fast food restaurant.

4 0
3 years ago
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