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Cloud [144]
3 years ago
9

The Nearside Co. just paid a dividend of $1.20 per share on its stock. The dividends are expected to grow at a constant rate of

4 percent per year, indefinitely. Investors require a return of 10 percent on the stock.What is the current price? What will the price be in 10 years?
Business
1 answer:
timurjin [86]3 years ago
4 0

Answer:

$20.80 and $29.61

Explanation:

The computations are shown below:

Current price is

= Next year dividend ÷ (Required rate of return - growth rate)

where,

Next year dividend is

= $1.20 + $1.20 × 4%

= $1.20 + $0.048

= $1.248

So, the current price is

= $1.248 ÷ (10% - 4%)

= $20.80

Now the price in 10 years is

= Next year dividend ÷ (Required rate of return - growth rate)

where,

Next year dividend is

= $1.20 × 1.04^10

= $1.20 × 1.4802442849

= $1.7762931419

So, the price in 10 years is

= $1.7762931419  ÷ (10% - 4%)

= $29.61

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Cora purchased a hotel building on May 17,.2018, for $3,000,000. Determine the cost recovery deduction for 2019.
Ostrovityanka [42]

Answer:

d. $76,920

Explanation:

Calculation to Determine the cost recovery deduction for 2019

Based on the information given we were told that they purchased a hotel building on May 2018 for the amount of $3,000,000 which means that to calculate the cost recovery deduction for 2019 we would be using 2.563 to multiply the cost of purchasing the hotel reason been that hotel building is a non residential property.

Hence,

Cost recovery deduction=2.563* $3,000,000

Cost recovery deduction=$76,920

Therefore the Cost recovery deduction will be $76,920

7 0
3 years ago
Comparative advantage is the ability to convince others of the best choices to make in their own self-interest. perform an activ
Ira Lisetskai [31]

Answer:

The correct answer is letter "B": perform an activity at a lower opportunity cost.

Explanation:

Comparative advantage is the ability of an individual, company, or country to produce a good or service at a lower opportunity cost than its competitor. Having a comparative advantage does not mean that one entity is absolutely better than another at producing a good or service. It means that it sacrifices less to do so.

3 0
3 years ago
If a firm's marginal costs _____ then its _____. Group of answer choices rise; output increases fall; best-response curve shifts
ziro4ka [17]

If a firm's marginal costs <u>fall</u>, then its <u>price falls.</u>

This is based on the principle that if the marginal cost of a product or firm rises, that implies that the firm is operating at a high fixed cost, thereby leading to an increase in the cost of production, which generally equates to products having a high price.

On the other hand, where there is low marginal cost, production costs reduce because the products are being produced at a lower fixed cost. Thereby leading to lower prices.

Hence, in this case, it is concluded that "If a firm's marginal costs <u>fall</u>, then its <u>price falls</u>."

Learn more here: brainly.com/question/10474336

7 0
2 years ago
How much does a trumpet weigh?
rjkz [21]

I think that may depend on the trumpet. I'm not sure tho

5 0
4 years ago
Read 2 more answers
I have been struggling with quizzes
Rudiy27

Answer:

same here

Explanation:

6 0
4 years ago
Read 2 more answers
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