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Shalnov [3]
3 years ago
5

Ashley is considering the purchase of a stock that has just paid a dividend of $0.72, today. The dividend is expected to grow at

a rate of 2.8 percent per year and the market requires a return of 10% on assets of similar risks. What is the price that Ashley should pay for this stock?
Business
1 answer:
arlik [135]3 years ago
7 0

Answer:

$10.28

Explanation:

<u>Step 1. Firstly we use the of the The dividend discount model (DDM)</u>

This calculation is: D1 = D0 x (1 + g)

D1 = $0.72 x (1 + 2.8%) = $0.74.

Where

Do = Dividend now

D1 = Dividend in year 1

g = growth

<u>Step 2 Next, using the Gordon Growth Model, </u>

Price per share is found to be D(1) / (r - g)

Price = $0.74 / ( 10% - 2.8%) = $10.28

where:

Do = Dividend now

D1 = Dividend in year 1

g = growth

r = required return

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Effective Interest Rate

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According to circus founder p.t. Barnum, what happens without publicity?
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Answer:

The correct answer would be, Decline in Customers.

Explanation:

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He started the circus in 1871 which became a huge success just because of his work plus the tactics of advertisement he used to promote his work. According to him, Decline in the customers happen without publicity. He believed that people will come to see your show only if you have attracted them enough to get them out of their houses and come to see your show through your powerful advertisements.

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Answer:

The equivalent units for conversion​ costs= 6,912 units

Explanation:

<em>The weighted average method of valuation would be used to determine the the equivalent units for conversion​ costs</em>

<em>Under the weighted average method of valuation, to account for completed units, it is assumed that the entire degree of work required is done in the period under consideration. So there is no separation of the completed units into opening inventory and fully worked. </em>

Equivalent unit = Degree of completion × Units of inventory

<em>Items                                       units                                    Equivalent unit</em>

Completed   unit                     3,300       3,300× 100 =       3.300

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7 0
3 years ago
Ardent Industries is considering starting a retirement plan for its 850 employees. One option company managers are considering i
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Answer:

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A profit sharing plan is defined as the type of contribution plan where the plan helps in saving for the retirement of the employees while providing them the flexibility of the plan features. It is a way for the owners of the business to share the profits with the investors and also a great way to attract investment in his business.

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