Answer:
A) $50
Explanation:
The computation of the intrinsic value of the stock is shown below:
But before that the required rate of return is computed by using CAPM
Required rate of return = Risk-free rate of return + Beta × (Market rate of return - risk-free rate of return)
= 5% + 0.5 × (13% - 5%)
= 5% + 0.5 × 8%
= 5% + 4%
= 9%
Now the intrisinc value is
= Dividend ÷ (required rate of return - growth rate)
= $6 ÷ (9% - (-3%)
= $6 ÷ 12%
= $50
Hence, the intrinsic value of the stock is $50
Therefore the correct option is A.
Answer:
Short-run economics primarily affect price.
Explanation:
When demand decreases for any reason, prices go down in the short term. When demand spikes, prices go up. ... Long-run adjustments occur when sustained increases or decreases in demand cause a business to change its practices and can affect both price and the means of production.
The answer is, larger; downward.
- Other things being equal, a larger supply of workers tends to put downward pressure on real wages.
<h3>How do wage increases affect the demand for and supply of labor?</h3>
- The quantity of work required will alter in response to changes in pay or salary.
- Employers will want to hire fewer workers if the pay rate rises.
- There will be a reduction in the amount of labor requested and an upward shift in the demand curve.
<h3>What causes wage increase?</h3>
- There are several reasons why employers may decide to raise salaries.
- An increase in the minimum wage is the most frequent justification for wage increases.
- The minimum wage can be raised by both the federal and state governments.
- Companies that manufacture consumer items are also renowned for giving their employees small pay raises.
<h3>How does wage increase affect supply?</h3>
- The aggregate supply curve shifts inward when the money wage rate increases, which results in a decrease in supply at all price levels.
- The aggregate supply curve shifts outward as the money wage rate declines, increasing the quantity supplied at any price level.
Learn more about real wages here:
brainly.com/question/1622389
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