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Paul [167]
3 years ago
5

Nick's Marine Company (NMC) currently has a stock price per share of $38. If NMC's cost of equity capital (the discount rate for

equity) is 15.2% and capital gains rate (gain/loss in prices relative to today's price) for the next year is expected to be 11.4%, the dividend in the upcoming year (t = 1) should be?
Business
1 answer:
choli [55]3 years ago
4 0

Answer:

$ 1.44

Explanation:

Given :

The stock price of 1 share = $ 38

The cost of equity capital, r = 15.2%

The capital gains rate for the next year, g = $ 11.4

Therefore, as per the dividend discount model,

The price per share = $\frac{D}{r-g}$

$\$ 38=\frac{D}{(0.152-0.114)}$

$\$ 38=\frac{D}{0.038}$

D = 38 x 0.038

   = 1.44

Therefore, the dividend = $ 1.44

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Answer:

It is preferable to further process Product A.

Explanation:

Product should be processed further before sale if the net incremental benefits from further processing is positive.

The net incremental benefits from further processing is increase in revenue when further processed less further costs of processing.

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                                 =$18,000

Further processing costs=$15,000

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Net incremental benefits=$3,000

Since processing further brings a net benefit of $3,000, Product A should be further processed before being sold.

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The present worth of the cost savings if the company uses an interest rate of 15% per year on such investments is $442108.5079.

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Therefore, the present worth of the cost savings if the company uses an interest rate of 15% per year on such investments is $442108.5079.

3 0
3 years ago
When a nation removes a tariff on a product, this policy action rev: 06_20_2018 Multiple Choice benefits domestic producers of t
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Answer:

benefits consumers of the product.

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When the import tariffs are withdrawn, the domestic price of the goods should decrease, benefiting consumers.

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Nicole works from home full-time for a non-profit organization. She receives work from and sends work to the office via a comput
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In this scenario, Nicole works from home full-time for a non-profit organization. She receives work from and sends work to the office via a computer and modem. Thus, this is an example of telecommuting.

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3 years ago
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aleksklad [387]

The Bretton woods system of exchange rates relied on <u>"fixed or pegged exchange rates, with occasional orderly adjustments to the rates."</u>



The Bretton Woods arrangement of money related administration built up the rules for business and monetary relations among the United States, Canada, Western Europe, Australia, and Japan after the 1944 Bretton Woods Agreement. The Bretton Woods framework was the principal case of a completely arranged financial request expected to administer money related relations among free states. The central highlights of the Bretton Woods framework were a commitment for every nation to embrace a fiscal approach that kept up its outer trade rates inside 1 percent by binds its money to gold and the capacity of the IMF to connect transitory uneven characters of installments. Likewise, there was a need to address the trouble among different nations and to anticipate focused depreciation of the monetary forms also.


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