A. is the only appropriate answer.
Answer:
c. book value per share.
Explanation:
The Total stockholders' equity is reflected on the balance sheet along with the total assets and the total liabilities
The formula to compute the book value per share is
= Total stockholders' equity ÷ number of common stock shares outstanding
By dividing the total stockholders' equity by the number of common stock shares outstanding we get the book value per share
Answer:
The correct answer is letter "D": requires that the dividend growth rate be less that the required rate of return.
Explanation:
The Gordon Growth Model is used to calculate the intrinsic value of a stock today, based on the stock's expected future dividends. It is widely used by investors and analysts to compare the predicted stock value against the actual market price. Its formula is:
P = D / r-g
where:
- P= current stock price
- g= dividend growth rate expected
- r= rate of return
- D= value of the dividends for the next year
The formula has limitations because <em>the rate of return must be higher than the dividend growth rate expected</em>. Otherwise, the resulting stock price would be negative and the model would be useless.
Answer:
The correct answer would be option C, By producing more than it consumes.
Explanation:
A developing country can generate internal funds by producing more than it consumes.
Internal funds are the funds that are generated internally, either at the individual level or at the country level. When a country generates funds on its own, the funds are called as the internal funds.
So internal funds can be generated by producing more than the consumption requirements. In this way the economic activities will increase, the money supply would be better and the country would be able to generate funds it need.
Answer: $1392
Explanation:
The depreciation rate under straight line is =1/5=0.2
The depreciation rate under double declining is = 0.2 × 2 = 0.4
Depreciation expense for the first year = 0.4 × $5800 = $2320.
At the beginning of year two, net book value = $5800 - $2320 = $3480
Depreciation expense for year two = 0.4 × $3480 = $1392