1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Ksivusya [100]
3 years ago
10

has just now paid a dividend of $2.50 per share (Div0); its dividends are expected to grow at a constant rate of 4 percent per y

ear forever. If the required rate of return on the stock is 14 percent, what is the current value of the stock, after paying the dividend
Business
1 answer:
miskamm [114]3 years ago
6 0

Answer:

$26

Explanation:

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

(2.5 x 1.04) / ( 0.14 - 0.04) = $26

You might be interested in
Which of the following best explains the quote below in terms of political propaganda?
Sphinxa [80]
<span>D. Goethe meant that people who speak out about political issues should thoroughly understand the issues they are taking about.
</span>
4 0
3 years ago
Read 2 more answers
you need a 20-year, fixed-rate mortgage to buy a new home for $210,000. Your mortgage bank will lend you the money at a 7.1 perc
Delicious77 [7]

Answer: $337,869.73

Explanation:

Find out the future value of $1,000 given an interest rate of 7.1%. If this amount is less than the future value of $210,000, the difference is added to the final payment to come up with the balloon payment.

The APR needs to be made periodic:

= 7.1% / 12

The $1,000 payment is an annuity so this can be calculated as:

= Annuity * ( ( 1 + rate) ^ number of periods - 1) / rate

= 1,000 * ( ( 1 + 7.1/ 12%) ²⁴⁰ - 1) / 7.1/12%

= $527,297.83

Future value of $210,000

= 210,000 * ( 1 + 7.1/ 12%) ²⁴⁰

= $865,167.56

Balloon payment will be:

= 865,167.56 - 527,297.83

= $337,869.73

3 0
3 years ago
Suppose the price level and value of the U.S. Dollar in year 1 are 1 and $1, respectively. Instructions: Round your answers to 2
Nookie1986 [14]

Answer:

0.74

Explanation:

Data provided  in the question

Price level = 1.35

According to the given situation, the computation of the new value of the dollar is shown below:-

The New value of the dollar = 1 ÷ Price level

= 1 ÷ 1.35

= 0.74074

or

= 0.74

Therefore for computing the new value of the dollar we simply applied the above formula.

3 0
3 years ago
Some of the considerations you might use to analyze the data include
Semenov [28]
B characteristics of the children etc
6 0
3 years ago
Why is it important that the military be able to evacuate supplies and people when necessary? When might they need to do this?
Marrrta [24]
It is important for the military to be able to evacuate supplies when necessary because then they can ensure the supplies will be safe the same with people. they do this during a war, major storms, and when plagues happen. 
5 0
3 years ago
Other questions:
  • Linda Clark received $223,000 from her mother’s estate. She placed the funds into the hands of a broker, who purchased the follo
    11·2 answers
  • Can someone type a paper for me
    9·2 answers
  • Let R^2 unrestricted and R^2 restricted be 0.4366 and 0.4149 respectively. The difference between the unrestricted and the restr
    12·1 answer
  • Colleen is a medical researcher at Octogen Pharmaceuticals. She called attention to the illegal marketing of a drug produced by
    11·1 answer
  • Which influential washington interest group has a membership of 40 million?
    15·1 answer
  • What is the expected return on this stock given the following information?
    9·1 answer
  • This problem has been solved!
    8·1 answer
  • Who has chegg please answer​
    6·1 answer
  • You were recently hired by Scheuer Media Inc. to estimate its cost of capital. You obtained the following data: D1 = $1.75; P0 =
    10·1 answer
  • Today, benefit and service offerings add nearly _________ to an organization payroll costs
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!