The value of current stock price is equal to $57.93
<u>Explanation:</u>
Given dividend = $20 per year
The calculation of current stock price is as follows:
The Stock price at the beginning of 20th year is equal to = $20 divided by 8 percent = 250
Current stock price ( present value ) =
After calculating, we get, 57.92801
Therefore, the value of current stock price is equal to $57.93 (rounded off to 2 decimal places).
Answer:
A. $600
Explanation:
The consumption equation equation given as follows
C= 225 + 0.75(YD).
C- consumption, autonomous consumption - 225, 0.75- marginal propensity to consume, YD- Disposable income.
The autonomous consumption in this equation is 225, this implies that an amount equal to the figure would be spent by the household irrespective of their income.
Another portion of the consumption is that which depends on the the amount of the disposable income. This equals to the marginal propensity to consume (0.75) multiplied by the disposable income.
Y= 225 + 0.75(YD)
Y = 225 + 0.75× (500)
Y = $600
Answer:
I'm figuring this out for you!
Explanation: