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
Free_Kalibri [48]
2 years ago
14

E-Eyes has a new issue of preferred stock it calls 20/20 preferred. The stock will pay a $20 dividend per year, but the first di

vidend will not be paid until 20 years from today. If you require a return of 9.75 percent on this stock, how much should you pay today
Business
1 answer:
Sever21 [200]2 years ago
5 0

Answer:

You would pay approximately $35.00 today

Explanation:

The cost of the stock at the beginning of the year 20

= 20/9.75%

= 20/0.0975

= 205.13 dollars

We find the current price of the stock

= Fv/(1+r)^n

= 205.13/(1+9.75%)¹⁹

= 205.13/1.0975¹⁹

= 205.13/5.86

= $35.00

From this calculation you have to pay 35 Dollars today.

You might be interested in
You have just received a windfall from an investment you made in a​ friend's business. He will be paying you at the end of this​
ohaa [14]

Answer:

a. $80,318.70

b. $97,568.57

Explanation:

Here is the full question :

You have just received a windfall from an investment you made in a​ friend's business. She will be paying you $ 15 comma 555 at the end of this​ year, $ 31 comma 110 at the end of next​ year, and $ 46 comma 665 at the end of the year after that​ (three years from​ today). The interest rate is 6.7 % per year. a. What is the present value of your​ windfall? b. What is the future value of your windfall in three years​ (on the date of the last​ payment)?

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow in year 1 = $ 15,555

Cash flow in year 2 = $31,110

Cash flow in year 3 =  $ 46,665

I = 6.7%

Present value = $80,318.70

The formula for calculating future value:

FV = P (1 + r)^n

FV = Future value  

P = Present value  

R = interest rate  

N = number of years  

$80,318.70(1.067)^3 = $97,568.57

3 0
3 years ago
In analyzing the value of the firm as a function of capital structure, the present value of the tax shield benefit is offset by
Hoochie [10]

Answer:

The correct answer to the following question will be Option D (Financial distress and agency costs).

Explanation:

  • A cost of an agency is a form of company's internal expense that comes from an employee working on behalf of action of the principle. Agency costs usually occur from core redundancies, confusion, and delays, such as shareholder and management conflicts of interest.
  • Distress expense applies to the expenses that a financially distressed company faces beyond the business cost, such as increased capital expenses. Troubled companies tend to have a tougher time fulfilling their financial responsibilities, which turns into a higher chance of default.
  • When evaluating the company's value as a feature of market structure, the present value of the tax shield gain is balanced by the current value of the anticipated financial distress and agency expenses, which results in an ideal internal market structure.

Therefore, Option C is the right answer.

5 0
2 years ago
"Global Marketing refers to: Group of answer choices The evolution of Marketing as being more than the offering of a product. Th
geniusboy [140]

Answer:

Global Marketing refers to the processes by which goods,services,capital,people,information,and ideas flow across national borders.

Explanation:

We operate in a world called global village,where time and location do not really impact doing businesses anymore, as people from different countries that are far apart, can do business without the need to physically meet, using different channels of communication made possible by advancement in technology.

Organizations,as the need to for businesses to sell its produce to a larger number of customers increases, are constantly considering selling to customers who are based in other countries through global marketing techniques.

5 0
3 years ago
What is the best advice for negotiating a business deal in a cross-cultural setting? avoid a win/win outcome. conduct transactio
DerKrebs [107]

In this case, you would want to avoid a win-lose situation.

1. You would want a win-win (where both parties feel as though they are gaining something from the transaction).

2. You can never go into an international negotiation with the same mentality as you would for in the US. Every culture is different and you should be aware of those differences.

3. You should not move too quickly between subjects. You should always ensure all parties understand and agree, which may take time.

7 0
3 years ago
An assembly line with 40 activities is balanced using 17 workstations and a finished product can be produced every 6.5 minutes.
asambeis [7]

Answer:

Maximum daily production rate= 6.125 units per day.

Minimum daily production rate= 75.38 units per day

Explanation:

Production rate is defined as the number of units of a product that is produced in a process in unit time.

In this instance we are to calculate the production rate per day.

It is given that a cycle consists of 40 activities. Completion time for 40 activities is 80 minutes.

Daily production rate = Total time of production/Time to complete one cycle

Maximum daily production rate= 490/80= 6.125 units per day.

Minimum daily production rate= 490/6.5= 75.38 units per day

5 0
2 years ago
Other questions:
  • Rodriguez Company pays $375,000 for real estate plus $19,875 in closing costs. The real estate consists of land appraised at $18
    13·2 answers
  • Being friendly and communicating enthusiastically with coworkers is an example of
    11·2 answers
  • The Boat Works decided to go public by offering a total of 135,000 shares of common stock to the public. The company hired an un
    8·1 answer
  • Which of the following is not a step in product design?
    15·1 answer
  • If bonds are issued at 101.25, this means that ____________________
    15·1 answer
  • Suppose public authorities were contemplating locating a hazardous waste incinerator in a particular community. If the members o
    7·1 answer
  • You have two employees who report directly to you. One is making $36,000/year and the second is making $24,000/year. You feel th
    11·1 answer
  • Hewo how are u today
    15·2 answers
  • An investment offers $6,200 per year for 20 years, with the first payment occurring one year from now. If the required return is
    8·1 answer
  • According to growth accounting studies, the most important factor in economic growth is Group of answer choices education. Inves
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!