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seraphim [82]
3 years ago
11

PandemicsPlus just paid a dividend of $1.00 per share and they consistently grown dividends at 4% annually. Investors require a

return of 12% on the firm's equity. What is the current value of the stock?
Business
1 answer:
oee [108]3 years ago
8 0

Answer:

$13

Explanation:

The current value of the stock can be determined using the constant growth dividend model

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

(1 x 1.04) / (0.12 - 0.04) = 13

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WHEN A TRAFFIC SIGNAL LIGHT IS NOT WORKING, YOU SHOULD:
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Alpha Division had the following information: Average operating asset base in Alpha Division $500,000 Operating income in Alpha
ExtremeBDS [4]

Answer:

15.79%

Explanation:

The computation of the return on investment is shown below:

Return on investment  = Operating Income ÷  New operating asset base

where,

Operating income is $60,000

And, the new operating asset is

= $500,000 - $120,000

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3 years ago
Freer trade, advances in information technology, and more global customers are pressuring many large global companies to:
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Firms are often involve in different kinds of trade. Freer trade, advances in information technology, and more global customers are pressuring many large global companies to shift from functional structures to geographically based divisionalized structures.

There are great advances in information technology (IT). Firms often get benefits of free trade in IT as they are able to expand their business into other different new areas with less effective charges.

FTA is known to be very good to optimal sharing of resources in the region as it helps to boast the efficiency of economic activities and also increase the stock of a country's technology.

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7 0
2 years ago
Last year, Bad Tattoo Co. had additions to retained earnings of $4,780 on sales of $95,560. The company had costs of $75,720, di
fredd [130]

Answer:

e. $6,042

Explanation:

Net income of Bad tattoo co. = Addition of retained earnings + Dividends

= $4,780 + $2,980

= $7,760

Income before tax of Bad tattoo Co = Net income / (1-tax rate)

= $7,760 / (1-34%)

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= $11,758

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Income before tax = Sales - Costs

- Depreciation expense - Interest expense

$11,758 = $95,560 - $75,720 - Depreciation expense - $2,040

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Depreciation expense = $19,840 - $11,758 - $2,040

Depreciation expense = $6,042

8 0
3 years ago
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