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kherson [118]
3 years ago
13

Your company is estimated to make dividends payments of $2.1 next year, $3.6 the year after, and $4.2 in the year after that. Th

e dividends will then grow at a constant rate of 6% per year. If the discount rate is 9% then what is the current stock price
Business
1 answer:
asambeis [7]3 years ago
7 0

Answer:

P0 = $122.79185  rounded off to $122.79

Explanation:

The dividend discount model (DDM) can be used to calculate the price of the stock today. DDM calculates the price of a stock based on the present value of the expected future dividends from the stock. The formula for price today under DDM is,

P0 = D1 / (1+r)  +  D2 / (1+r)^2  +  ...  +  Dn / (1+r)^n  +  [(Dn * (1+g) / (r - g)) / (1+r)^n]

Where,

  • D1, D2, ... , Dn is the dividend expected in Year 1,2 and so on
  • g is the constant growth rate in dividends
  • r is the discount rate

P0 = 2.1 / (1+0.09)  +  3.6 / (1+0.09)^2  +  4.2 / (1+0.09)^3  +  

[(4.2 * (1+0.06) / (0.09 - 0.06)) / (1+0.09)^3]

P0 = $122.79185  rounded off to $122.79

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Bob's electronics company has quite a buzz around a new television they're launching, called UltraView1000. This television is e
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Bob’s ad will appear if search terms contain at least all three of the keywords or variations of those terms.

Explanation:

Bob’s ad will appear if search terms contain at least all three of the keywords or variations of those terms.: Adding a + sign in front of a keyword turns it into a broad match modifier. This prompts your ads to appear only if the keyword or its close variations are in any part of the search terms.

If Bob uses the broad match modifier keywords “television,” “accessible,” and “voice.” His ads will appear for people searching for any combination of these terms in a search (and possibly including additional terms). However, the ads won’t appear if any one of these keywords aren’t in the search term.

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3 years ago
Calculate the present value of $4,000 received five years from today if your investments pay (Do not round intermediate calculat
Elanso [62]

Answer:

A = $2,989.30

B = $2,722.33

C = $2,483.68

D = $2,455.65

E = $2,441.08

Explanation:

Given:

Future value (A) = $4,000

Present value (P) = ?

Number of Year (N) = 5.

A. R = 6% = 0.06

P=\frac{A}{(1+R/100)^N}\\P=\frac{4000}{(1+0.06)^5}\\P=\frac{4000}{(1.06)^5}\\\\P=\frac{4000}{(1.06)^5}\\P=\frac{4000}{1.33822558}\\\\P=2,989.032

B. R = 8% = 0.08

P=\frac{A}{(1+R/100)^N}\\P=\frac{4000}{(1+0.08)^5}\\P=\frac{4000}{(1.08)^5}\\\\P=\frac{4000}{1.46932808}\\\\P=2,722.3327

C. R = 10% = 0.1

P=\frac{A}{(1+R/100)^N}\\P=\frac{4000}{(1+0.1)^5}\\P=\frac{4000}{(1.1)^5}\\\\P=\frac{4000}{1.61051}\\\\P=2,483.6852

D. R= 10/2 = 5% N=5*2 = 10

P=\frac{A}{(1+R/100)^N}\\P=\frac{4000}{(1+0.05)^{10}}\\P=\frac{4000}{(1.05)^{10}}\\\\P=\frac{4000}{1.62889463}\\\\P=2,455.6530

E. R = 10/4 = 2.5% N = 5*4 = 20

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Riverwalk Corporation is liquidated, with Juan receiving $5,000 in money, other property having a $6,000 FMV, and a $1,000 mortg
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Answer:

The correct option is B,$2000

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Property less mortgage:

Property value  $6000

Mortgage          ($1000)         $5000

Total                                        $10,000

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gain on stock                           $2,000

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Option C is wrong since the property mortgage of $1000 must be deducted from the property before computing the gain or loss.

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For more information about the production possibility frontier, please check: brainly.com/question/25774783

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