1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
oee [108]
3 years ago
5

Exercise Bicycle Company is expected to pay a dividend in year 1 of $1.20, a dividend in year 2 of $1.50, and a dividend in year

3 of $2.00. After year 3, dividends are expected to grow at the rate of 10% per year. An appropriate required return for the stock is 14%. The stock should be worth ________ today.
A) $33.00
B) $39.86
C) $55.00
D) $66.00
E) $40.68
Business
1 answer:
prisoha [69]3 years ago
3 0

Answer:

E.  $40.68

Explanation:

The computation of the stock worth today is shown below:

= (Dividend in year 1 ÷ 1 + required rate of return^number of years ) + (Dividend in year 2 ÷ 1 + required rate of return^number of years) + (Dividend in year 3 ÷ 1 + required rate of return^number of years)  + (Dividend in year 3 ÷ 1 + required rate of return^number of years) × (1 + growth rate) ÷ (required rate of return - growth rate)

= $1.2 ÷ 1.14 + $1.5 ÷ 1.14^2 + $2 ÷ 1.14^3 + $2 ÷ 1.14^3 × (1 + 10%) ÷ (14%-10%)

= $40.68

We simply applied the above formula

You might be interested in
Lap Corporation uses the weighted-average method in its process costing system. The beginning work in process inventory in a par
SpyIntel [72]

Answer:

The cost of the units completed and transferred out of the department was $825,000.

Explanation:

The costs per equivalent unit for the month were $2.00 for materials and $3.50 for conversion costs.

= 150,000 units × ($2.00 + $3.50) = $825,000.

7 0
3 years ago
When the workers in a workshop encounter operating difficulties or breakdowns while handling their machinery, they seek the help
omeli [17]

Answer:

D. Technical problem solver.

Explanation:

A leader or a manager acts as a technical problem solver in the place where they make and implements decisions that will solve the problem faced by his subordinate at different levels or process of carrying out their duties  

As a technical problem solver,  managers performs individual contributor tasks on a regular basis, such as  repairing machinery.

5 0
3 years ago
what countries represent the largest global business opportunities for the next decade? what factors determine the size of the o
aksik [14]
This is of course somewhat of a subjective question, but in general most would agree that China, the United States and Germany represent the largest global business opportunities for the next decade based mostly on factors of production.
5 0
2 years ago
If the total warehousing cost for the year amounts to $450,000, and 40 percent of the warehousing activity is associated with fi
photoshop1234 [79]
The answer is A. $270,000.
3 0
3 years ago
Congress passed a law imposing penalties for displaying "indecent" material online where children could see it. If the U.S. Supr
ratelena [41]

Answer:

1) True

Explanation:

The checks and balances system allows every one of the government branches a say on new laws. First of all, Congress makes and passes laws. Second, the President can veto any law, and Congress needs two-thirds votes on both houses to overrun the presidential veto. Third, the Supreme Court decides if the law is constitutional or not, if it decides that the law is unconstitutional, it is eliminated completely or partially depending on the ruling.

6 0
3 years ago
Other questions:
  • Two insulation thickness alternatives have been proposed for a process steam line subject to severe weather conditions. One alte
    5·1 answer
  • According to COSO, a system of internal controls is designed to provide reasonable assurance about the achievement of entity obj
    7·1 answer
  • Cheyenne has a home insured for $160,000. It would cost $180,000 to rebuild her home. If she has home insurance that provides pe
    11·1 answer
  • The following monthly data are available for Coronado Industries. which produces only one product: Selling price per unit, $38;
    13·1 answer
  • You are considering investing $1,000 in a complete portfolio. The complete portfolio is composed of Treasury bills that pay 5% a
    8·1 answer
  • If Ming wants a tertiary color, she should combine
    15·2 answers
  • actor Co. can produce a unit of product for the following costs: Direct material $ 8.60 Direct labor 24.60 Overhead 43.00 Total
    10·1 answer
  • The price elasticity of demand (based on the midpoint formula) when price increases from $10 to $12 is:______
    8·1 answer
  • On January 1, 2015, Johnson Company purchased a delivery truck for $72,000, paying $7,200 cash and financing the rest with a 4 y
    11·1 answer
  • Have you ever witnessed fan misbehavior? describe the experience and how it impacted the value you received from the experience.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!