Answer:
e) $37.05
Explanation:
Using the dividend growth model, the value of a stock is the present value of the future dividends receivable discounted at the required rate of return . The required rate of return is given as 12%.
So we discount the year 3 dividend using the dividend growth model formula
P = D (1+g)/r-g
r- rate of return, g = growth rate
Present value of the future dividends:
PV of Year 1 = 1.55(1.015)m × 1.12^(-1)
= 1.4047
PV of Year 2 = 1.55 (1.015)(1.015) × 1.12^(-2)
= 1.27
PV of Year 3 (this will be done in two steps)
Step 1; PV (in yr 2) of year 3 dividend
= (1.55)(1.015)^2×(1.08)/(0.12-0.08)
=43.114
Step 2 : PV (in yr 2) of year 3 dividend
=43.114 × (1.12^(-2))
= 34.37
Best estimate of stock = 1.40 + 1.27 +34.37
= $37.05
Note
To discount the year 3 dividend, we use two steps. The first stp helps get the PV in year 2, and step 3 helps to take it further to the PV in year 0
Answer: Option A
Explanation: In simple words, Variable cost is that cost of the business that changes with level of production. Hourly wage rate of workers, electricity bill of factory are some of many examples of variable cost.
The electricity consumption is fixed per unit, but if the level of production rises the electricity bill also rises as more units will be consumed.
Hence, from the above we can conclude that the right option is A.
Answer:
A) leveraging new core competencies to improve current market position.
Explanation:
As is given in the scenario, the people that the company Ancho is trying to get are <em>potential customers</em> rather than existing, hence they cannot be said to be building new core competencies <em>to protect and extend current market position</em>. That would have been the case if they were trying to keep those that were already customers to the company.
Ancho cannot also be said to be <em>redeploying existing core competencies to compete in future markets </em>because they are actually acquiring new competencies in electric car manufacturing which was not their original line of business.
There is also no case of <em>unlearning existing core competencies </em>because Anchor has deployed existing competencies in developing a hybrid car rather than just an electric one.
Hence Anchor is trying to get new customers while keeping the old ones and has made a car that will appeal to both existing and potential customers to improve current market position.
Answer:
Theresa has $6,000 in equity.
Explanation:
To get this answer, you take the value of her car ($15,000) and subtract the amount that she owes from it ($15,000-$9,000). This gives you $6,000.
Hope this helps!
Answer:
The statement is: False.
Explanation:
Vigorous wording refers to the act of making information appear more than what it really is, in some cases exaggerating the attention in one point or another. The phrase:
"<em>our company experienced an increase in profits during the last fiscal year</em>";
provides direct, objective information about an event that happened. There are not adjectives that might distort the main message that is intended to be provided.
