1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Tanya [424]
4 years ago
13

Cooperton Mining just announced it will cut its dividend from $4.01 to $2.57 per share and use the extra funds to expand. Prior

to the​ announcement, Cooperton's dividends were expected to grow at a 3.4% ​rate, and its share price was $50.07. With the planned​ expansion, Cooperton's dividends are expected to grow at a 4.7% rate. What share price would you expect after the​ announcement? (Assume that the new expansion does not change​ Cooperton's risk.) Is the expansion a good​ investment?
Business
1 answer:
mina [271]4 years ago
8 0

Answer:

$34.35

The price has fallen from $50.07 to $34.35 which means that Expansion will not be a good option.

Explanation:

Computation for the share price to expect after the announcement

Using this formula

Ke = [ D1 / P0 ] +g

Where,

D1 =$4.01

P0 = $50.07

g =3.4%

Let plug in the formula

Ke = [ D1 / P0 ] +g

Ke= [ $4.01 / $50.07] + 0.034

Ke= 0.0800+ 0.034

Ke= 0.1140

Second step is to find the Price after Expansion using this formula

P0 = D1 / [ Ke - g ]

Where,

D1=$2.57

Ke=0.1140

g=4.7%

Let plug in the formula

P0= $ 2.57 / [ 0.1140 - 0.047 ]

P0=$2.57/0.067

P0=$ 34.35

Based on this calculation, we can see that the price has fallen from $50.07 to $34.35 which means that Expansion will not be a good option.

Therefore the share price that you would expect after the​ announcement will be $34.35

You might be interested in
Which two renewable technologies do not rely on energy from the sun?.
Anon25 [30]

Answer:

GEOTHERMAL  AND TIDAL ENERGY

Explanation:

5 0
2 years ago
Miranda works at a small-batch soda pop manufacturing plant. for eight hours a day, she uses her right hand to lift individual b
OlgaM077 [116]
I don’t know the choices, but I’d say it is a reptitive strain injury. This is an injury that is caused due to too much use of a certain appendix, in this case, Miranda’s right hand. Because she uses it eight hours a day, virtually nonstop, it makes sense that she would have repetitive strain injury.
5 0
4 years ago
In an examination of purchasing patterns of shoppers, a sample of 20 shoppers revealed that they spent, on average, $54 per hour
ZanzabumX [31]

Answer:

Confidence interval for the mean amount = 54+1.645*21/sqrt(16) =(62.64 , 45.36)

Explanation:

confidence interval = mean + z*, where z* is the upper (1-C)/2 critical value for the standard normal distribution.

z score for 90% confidence interval = 1.645

confidence interval for the mean amount = 54+1.645*21/sqrt(16) =(62.64 , 45.36)

5 0
4 years ago
Enlightened marketing calls for building long-run consumer engagement, loyalty, and relationships by continually improving the b
larisa86 [58]

Answer: Customer value marketing

Explanation:

Customer value marketing could be defined as measures taken by companies to improve services for the customers, the aim of these method of marketing is to retain the customer to always engage in the services offered by the company. Companies vary in how the carry out this marketing method, most use calls, mails, physical visit to clients residence or office or promotional offers which will motivate the costumer buy more or always prefer the companies services. Enlightened marketing calls is one of the measures taken to retain customers. This calls tell the customer of how the services of the firm is improving and other updates the customer needs to know.

7 0
4 years ago
Read 2 more answers
Frankenstein Enterprises received two notes from customers for sales that Frankenstein made in 2013. The notes included:Note A:
Kipish [7]

Answer:

Option B ⇒ The annual interest rate on Note A is  9.35% .

Explanation:

Note B has an accrued interest for six months during 2013: $220,000 x .08 x 6/12 = $8,800.

The remainder of the accrued interest, $7,200 ($16,000 - $8,800) was from Note A, which was held for seven months in 2013.

Therefore, we have the following: $132,000 x annual interest rate x 7/12 = $7,200.

Thus, the annual interest rate on Note A would be ($7,200/132,000) x 12/7 = 9.35%.

Option B ⇒ 9.35% is the correct answer.

7 0
3 years ago
Other questions:
  • An externality is an intangible effect of production and purchases.<br> TRUE<br> FALSE
    8·1 answer
  • Mustard's Inc. sold the rights to use one of its patented processes that will result in cash receipts of $2,500 at the end of ea
    12·1 answer
  • o calculate the beta of another company, using regression analysis, you get the value of R² as 0.91. Based on your calculation,
    8·2 answers
  • What are the four elements of the marketing mix?
    15·1 answer
  • Identify the accounts below that would be classified as current liabilities on a classified balance sheet. (Check all that apply
    7·1 answer
  • What are the solutions for cos2 x - cos2x = 0​
    12·1 answer
  • Explain how the U.S. economic system differs from the economic system in Cuba.
    8·1 answer
  • Assume that Partners A and B each report a Capital Account of $500,000. Partner C wants to join the partnership as an equal one-
    14·1 answer
  • Journalize this transaction as if jumpstart paid cash
    11·1 answer
  • round house furniture offers credit to its customers at a rate of 1.15 percent per month. what is the effective annual rate of t
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!