Answer: Price of stock at year end =$53
Explanation:
we first compute the Expected rate of return using the CAPM FORMULAE that
Expected return =risk-free rate + Beta ( Market return - risk free rate)
Expected return=6% + 1.2 ( 16%-6%)
Expected return= 0.06 + 1.2 (10%)
Expected return=0.06+ 0.12
Expected return=0.18
Using the formulae Po= D1 / R-g to find the growth rate
Where Po= current price of stock at $50
D1= Dividend at $6 at end of year
R = Expected return = 0.18
50= 6/ 0.18-g
50(0.18-g) =6
9-50g=6
50g=9-6
g= 3/50
g=0.06 = 6%
Now that we have gotten the growth rate and expected return, we can now determine the price the investors are expected to sell the stock at the end of year.
Price of stock = D( 1-g) / R-g
= 6( 1+0.06)/ 0.18 -0.06
=6+0.36/0.12
=6.36/0.12= $53
Answer:
The correct word for the blank space is: Inconsistency.
Explanation:
In an attempt of making a service into a product, we can identify four (4) characteristics those services must meet: <em>intangibility, inconsistency, inseparability, </em>and<em> inventory</em>. The inconsistency characteristic refers to services being different one from another because they are provided by people which implies even if the service might be standardized the way it is provided will not always be the same.
Answer:
NEUTRALITY, COMPLETENESS AND FREE FROM ERRORS.
Explanation: IASB( International accounting standards board) is board regulating the preparation of accounting Reports or statements. It released its first framework called CONCEPTUAL FRAMEWORK in the year 1989.
The qualities of a faithful conceptual framework by IASB is to guarantee NEUTRALITY, COMPLETENESS AND ENSURE THAT THE STATEMENT IS FREE FROM ERRORS.
This framework will help to prevent disputes and manage standards in preparation of account statements.
Answer:
Franchising.
Explanation:
Franchising is an effective way to enter into market when a person has few or no knowledge about the market conditions. This is most suitable for food chains as there is no or minimum changes required for the operations. It is safe option for new entrants.
Answer:
If Silver uses the accrual method, $195,000 in 2018 and $0 in 2019.
Explanation:
Given that,
Salaries paid during the year 2018 = $175,000
Salaries earned by the employees at the end of the year = $20,000
If the Silver, Inc. uses the accrual method,
Deduction for salary expense in 2018:
= Salaries paid during the year 2018 + Salaries earned by the employees at the end of the year
= $175,000 + $20,000
= $195,000
Deduction for salary expense in 2019 = $0