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Novosadov [1.4K]
3 years ago
7

Stocks A and B have the following data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the f

ollowing statements is correct?
A B
Price $25 $40
Expected growth 7% 9%
Expected return 10% 12%
A) The two stocks should have the same expected dividend
B) The two stocks could not be in equilibrium with the numbers given in the question
C) A's expected dividend is $0.50
D) B's expected dividend is $0.75
E) A's expected dividend is $0.75 and B's expected dividend is $1.20
Business
1 answer:
IrinaK [193]3 years ago
5 0

Answer: E) A's expected dividend is $0.75 and B's expected dividend is $1.20

Explanation:

Using the Gordon growth model, you can calculate the expected dividend. The formula is:

Price = Expected dividend/ (expected return - expected growth)

Stock A expected dividend

25 = D/ (10% - 7%)

D = 25 * 3%

= $0.75

Stock B expected divided

40 = D / (12% - 9%)

D = 40 * 3%

= $1.20

Option A, C and B are therefore wrong.

Option E is correct.

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Wilson states, "Culture is important to me. Our culture is based on accountability, camaraderie, and results. I’ve moved from fi
Snowcat [4.5K]

Answer:

Self nurturing

Explanation:

Self nurturing refers to teaching oneself and to learn along a period owing to the projects one undertakes. This means experience and knowledge attained over time by an individual. Such knowledge is acquired by an individual on his own.

Self nurturing entrepreneurs are those entrepreneurs who have immense self belief and who back their views and business ideas.

In the given case, Wilson has learnt from his experiences, the importance of organizational culture and what it stands for. Here Wilson depicts the trait of learning along on his own and being self taught. This displays the attribute of self nurturing.

6 0
3 years ago
The bond has a coupon rate of 6.11 percent, it makes semiannual payments, and there are 2 months to the next coupon payment. A c
allsm [11]

Answer:

$997.37

Explanation:

For computing the invoice price first we have to determine the accrued interest which is shown below:

Accrued interest is

= Par value × coupon rate × remaining months ÷ total months

= $1,000 × 6.11% × 4 months ÷ 12 months

= $20.37

Now

Invoice price is

= Clean price + Accrued interest

= $977 + $20.37

= $997.37

6 0
3 years ago
An ______ is a period of low economic activity and rising unemployment.
soldier1979 [14.2K]
Recession or downturn
6 0
3 years ago
Read 2 more answers
The Assembly Department produced 1,000 units of product during March. Each unit required 1.25 standard direct labor hours. There
frutty [35]

Answer:

Debit Work in process for $15,625

Debit Direct labor time variance for $625

Credit Direct labor rate variance for $650

Credit Wage payable for $15,600

Explanation:

Before preparing the journal, the following calculations are done first:

Wage payable = Actual hours * Actual rate per hour = 1,300 * $12 = $15,600

Direct labor time variance = (Actual hours - Standard hours) * Standard direct labor rate = (1,300 - (1,000 * 1.25)) * $12.50 = $625 Unfavorable

Note: Direct labor time variance is Unfavorable because Actual hours is greater than Standard hours.

Direct labor rate variance = (Actual rate - Standard rate) * Actual hours = ($12 - $12.50) * 1,300 = -$650 Favorable

Note: Direct labor rate variance if Favorable because Actual rate is lower than the Standard rate.

Work in process = Wage payable + Absolute value of direct labor rate variance - Direct labor time variance = $15,600 + $650 - $625 = $15,625

The journal entries will now look as follows:

<u>Date           Particulars                                         Debit ($)           Credit ($)   </u>

Mar. 31       Work in process                                  15,625

                  Direct labor time variance                      625

                  Direct labor rate variance                                                 650

                  Wage payable                                                               15,600

<u><em>                   (To record the direct labor in the Assembly Department.)       </em></u>

4 0
3 years ago
Which of the following borrowing options would cost her the least? Credit card. Personal loan at bank. Student loan. Payday loan
nika2105 [10]

Answer:

Explanation:

The student loan is set up to have a very low interest rate. They are mostly in the 2 to 3 % range if you qualify. The worst is a payday loan. Those have double digit rates associated with them.

5 0
1 year ago
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