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salantis [7]
3 years ago
9

Hailey Corporation pays a constant $9.45 dividend on its stock. The company will maintain this dividend for the next 13 years an

d will then cease paying dividends forever. If the required return on this stock is 10.7 percent, what is the current share price
Business
1 answer:
svet-max [94.6K]3 years ago
5 0

Answer: $64.76

Explanation:

The current share price in this case will be the present value of the dividends,

As the dividends are constant, they can be treated as annuities.

Present value of annuity = Annuity * ( 1 - (1 + rate)^-number of periods) / rate

= 9.45 * ( 1 - (1 + 10.7%)⁻¹³) / 10.7%

= 9.45 * 6.8529386295

= $64.76

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Which of the following would NOT be a benefit of purchasing call options for the stocks of a number of different companies?
maria [59]

Answer: Option B

Explanation:

Call option is the purchase of the right to purchase the product at a fixed price before the time agreed. Buying call options, would limit the risk level to the premiums paid for the calls. So the option A is correct and by the exercise of this call option early cannot limit risk on the portfolio. The remainder two are the benefit of purchasing call options.

6 0
4 years ago
When using the cost of production report to analyze the change in direct materials cost per equivalent unit compared to conversi
alisha [4.7K]

Answer: a.may increase while conversion costs decrease because the two are separately calculated and depend on separate costs.

Explanation:

When the cost of production report is being used to analyze change in direct materials cost per equivalent unit when compared to the conversion cost per equivalent unit, we should note that an investigation may end up showing that the fluctuation in the the direct materials costs which then brings about an increase or a decrease.

Therefore, the correct option is A "may increase while conversion costs decrease because the two are separately calculated and depend on separate costs".

5 0
3 years ago
A monopolist has four distinct groups of customers. Group A has an elasticity of demand of​ 0.2, B has an elasticity of demand o
Bumek [7]

Answer:  Group A

Explanation:

Price Elasticity of demand refers to the sensitivity of quantity demanded given a change in price. In other words, how much will quantity demanded change if price changes. Higher elastcities mean that when prices change, their quantity demanded changes more. For instance, an elasticity of demand of 2 means that when prices rise by 2%, demand will decrease by 4%.

The group that will be paying the most therefore will have to be the group that is least sensitive to paying that high price. That would be Group A. As they are not very sensitive to price changes with an elasticity of 0.2, the Monopoly can increase their price to a higher point than others knowing that they won't demand less goods.

5 0
3 years ago
two small countries, palau and tuvalu produce two goods: fish and coconuts. palau can produce 60 fish per hour or 20 coconuts pe
yuradex [85]

The opportunity cost of producing one fish for Pilau is 1/4 coconut.

<h3>What is the opportunity cost?</h3>

Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives.

Opportunity cost arises because the resources available to carry out production activities are available in limited quantities. So, when economic agents decide to produce a good, they forgo the opportunity to use the same resources to produce another good.

Economic theory suggests that the good that should be produced is the good that has the least opportunity cost.

Opportunity cost for Pilau of producing fish : 20 / 60 = 1/4 coconut

Please find attached the complete question. To learn more about opportunity cost, please check: brainly.com/question/26315727

#SPJ1

5 0
2 years ago
Bob decides to sell his home as termites are ruining its foundation. Jill purchases the property and does not know about the ter
Murrr4er [49]

Answer: True

Explanation:

US State Laws protect home buyers by requiring that home sellers disclose any and everything in the property that may reduce the value of the property.

They require that any repairs that need to be made and any defects that it may have be disclosed before the property is sold. This is particularly true for Texas.

If a property is sold wilfully with knowledge of these defects then the party selling is liable for fraud as well as a civil suit that the seller may bring against them. Selling the house under the condition ' As Is ' does not void these obligations either.

So yes, as Bob was aware of this issue and remained silent, he must pay $50,000 to Jill or fix the termite damage, even though the home is no longer his.

3 0
3 years ago
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