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Blababa [14]
3 years ago
10

Alpha Wood Interiors announced that it is going out of business. As of today, no more regular dividends will be paid. The firm w

ill, however, pay two liquidating dividends. The first will be paid one year from now in the amount of $17 a share. The second and final payment will be paid two years from now at an estimated $32 a share. What is the value of this stock today at a discount rate of 6 percent
Business
1 answer:
xz_007 [3.2K]3 years ago
4 0

Answer:

$44.52

Explanation:

The value of the stock today can be determined by finding the present value of the liquidating dividends

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow in year 1 = 17

Cash flow in year 1 = 32

I = 6%

PV = $44.52

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

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Answer: C. real GDP = $6.0 trillion and aggregate planned expenditures = $4.0 trillion

Explanation:

Unplanned Inventory arises when Real GDP is larger than Planned Expenditure because it must satisfy the below formula,

Real GDP = Planned + Unplanned expenditure

For Option C,

Real GDP = 6.0 trillion,

Planned expenditure = 4.0 trillion

Unplanned Expenditure = Real GDP - Planned Expenditure

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Therefore Option C is correct as it led to a $2.0 trillion increase in Expenditure which translates to inventory.

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4 years ago
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3 0
3 years ago
select a reason why a company would want to go public. to consolidate control of the company in the hands of management to incre
iogann1982 [59]

The company would go public to <u>decrease administrative costs</u>

<h3>What is Business Consolidation?</h3>

Business consolidation is the process of combining various business divisions or corporations into a single, larger organization. By eliminating redundant personnel and processes, business consolidation is a legal strategy that is frequently used to increase operational efficiency. No matter how costly and difficult it may be in the short term, business consolidation—often associated with mergers and acquisitions (M&A)—can produce long-term cost savings and a concentration of market share.

There are various business consolidation models, such as variable interest entities and statutory consolidation.

When two or more businesses combine to form one, this is called consolidation. Consolidation of businesses, also referred to as amalgamation, is most frequently linked to M&A activity.

This typically occurs when a number of comparable smaller businesses join forces to create a new, larger legal entity. The smaller entities typically vanish after being absorbed by the acquirer.

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3 0
2 years ago
Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs t
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Answer:

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<u>Now, we can allocate overhead:</u>

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7 0
3 years ago
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