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serg [7]
3 years ago
6

Stoneheart Group is expected to pay a dividend of $3.17 next year. The company's dividend growth rate is expected to be 3.9 perc

ent indefinitely and investors require a return of 11.7 percent on the company's stock. What is the stock price?
Business
1 answer:
AleksAgata [21]3 years ago
8 0

Answer:

The price of the stock= 40.64

Explanation:

According to the dividend growth model, the price of a stock is the present value of expected dividend discounted at the required rate of return.

This is done as follows:

Price of a stock = D×(1+r)/(r-g)

D(1+g) - Dividend for next year = 3.17

g- growth rate - 3.9%

r- required rate of return - 11.7%

P = 3.17/(0.117- 0.039)=40.641

The price of the stock= 40.64

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Aneli [31]

Answer:

800 units of product A must be sold for break-even

Explanation:

Given, weighted-average contribution is $100.

Total break-even units = Total fixed cost  / Weighted-average contribution

Total break-even units = $400,000  / $100

Total break-even units = 4,000 units

Product A break-even = 4,000 x 20%

Product A break-even = (800 units)

Hence, the correct answer is 800 units.

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The slope of the _________________ is determined by the relative price of the two goods, which is calculated by taking the price
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Answer:

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The absolute slope of the budget constraint is the relative price of the two goods represented on the graph.

I hope my answer helps you

8 0
3 years ago
Which Human Services workers must have a strong sense of visual style in order to carry out the tasks for which they
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6 0
2 years ago
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A newly issued bond has a maturity of 10 years and pays a 7.7% coupon rate (with coupon payments coming once annually). The bond
Sliva [168]

The convexity of the bond is 61.810 and the duration of the bond is 7.330 years.                                                                                                      

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  • A newly issued bond has a maturity of 10 years. It pays a 7.7% coupon rate. The coupon payments will receive each year. Using the coupon payments the year will be reduced.
  • The maturity year will get reduced. So the duration of the bond is approximately 7.330 years. If the bond is sold at par value the convexity can be calculated using the number of years.
  • So the convexity of the bond is 61.810.                                                                            

3 0
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