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Crank
2 years ago
7

Each of two stocks, A and B, are expected to pay a dividend of $5 in the upcoming year. The expected growth rate of dividends is

10% for both stocks. You require a rate of return of 11% on stock A and a return of 20% on stock B. The intrinsic value of stock A
A. will be greater than the intrinsic value of stock B.
B. will be the same as the intrinsic value of stock B.
C. will be less than the intrinsic value of stock B.
D. cannot be calculated without knowing the market rate of return.
Business
1 answer:
salantis [7]2 years ago
3 0

Answer:

a

Explanation:

Intrinsic  value can be determined using the constant dividend growth model

according to the constant dividend growth model

price = d1 / (r - g)

d1 = next dividend to be paid

r = cost of equity

g = growth rate

Stock A = $5/ (0.11 - 0.1) = $500

Stock B = $5/ (0.2 - 0.1) = 50

Intrinsic value of A is greater than that of B

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This implies that the manufacturing overhead for the month was underapplied by ($75000 - $56000)= $19000. The manufacturing overhead debit balance shows that manufacturing overhead was simply underapplied in this case.

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mrs_skeptik [129]

Answer:

Tariff of 1832

Explanation:

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Please help!!! I need help ASAP!
34kurt
Hi!

 The answer to your question should be B. Pays the difference of the current value to the amount you owe.
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Answer:

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