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2 years ago

How to find the slope from 2 points

1 answer:

7 0

In order to find the slope of two points, we would divide the top number, and also by its bottom number, and from doing this, we would find its measurements.

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Assume that today is December 31, 2019, and that the following information applies to Abner Airlines: After-tax operating income

melamori03 [73]

Answer:

The company's stock price today should be $71.17 per share.

Explanation:

The corporate valuation model approach can be used to estimate this by using the following steps:

Step 1: Calculation of the free cash flow

Free cash flow is the cash a firm generates after accounting for capital expenditure. This can be estimated using the following formula:

Free Cash Flow (FCF) = After-tax operating income + Depreciation expenses - Capital expenditure

For this question, we therefore have:

Free Cash Flow (FCF) = $700 + $150 - $375 = $475 million

Step 2: Calculation of Value of operations (Vo)

Vo = FCF / (WACC - FCF growth rate) = 475 / (11% - 7%) = $11,875 million

Step 3: Calculation of the Firm value

Firm value = Vo + Non-operating assets = $11,875 + $199 = $12,074 million

Step 4: Calculation of value of equity

Value of equity = Firm value - Debt = $12,074 - $3,534 = $8,540 million

Note: The correct amount of debt is $3,534 not $3.540 as mistakenly given, may be due to typographical error, in the question.

Step 5: Calculation of stock price per share today

Stock price per share = Value of equity / Number of shares outstanding = $8,540 / 120 = $71.17 per share

Therefore, the company's stock price today should be $71.17 per share.

7 0

3 years ago

The opportunity cost of an item is a. what you give up to get that item. b. usually less than the dollar value of the item. c. t

Jobisdone [24]

Answer: a

Explanation:

Opportunity costs represent the benefits an individual, investor or business misses out on when choosing one alternative over another. While financial reports do not show opportunity cost, business owners can use it to make educated decisions when they have multiple options before them.

Because by definition they are unseen, opportunity costs can be easily overlooked if one is not careful. Understanding the potential missed opportunities foregone by choosing one investment over another allows for better decision-making.

Opportunity cost analysis also plays a crucial role in determining a business's capital structure. While both debt and equity require expense to compensate lenders and shareholders for the risk of investment, each also carries an opportunity cost. Funds used to make payments on loans, for example, are not being invested in stocks or bonds, which offer the potential for investment income. The company must decide if the expansion made by the leveraging power of debt will generate greater profits than it could make through investments.

6 0

2 years ago

TT TOYS manufactures toys. The company recently started buying paint for its toys from a Chinese firm. This Chinese company is p

snow_lady [41]

Answer:

The correct answer is Supply Chain

Explanation:

TT toys have recently started buying paint from a Chinese company to complete the final product. The Chinese company is part of the supply chain because it is helping TT toys to complete the final product. The Chinese company is providing a resource, and any operation which acts as a source, resource, or information to complete a product is a part of a supply chain management.

4 0

3 years ago

Select all that apply.

Dominik [7]

Answer:

Supply equals demand

Explanation:

Equilibrium is a situation which occurs when there is a balance between quantity demanded and quantity supplied.

5 0

3 years ago

#2- Almost all economic systems today are ?

Flauer [41]

Mixed economies- These systems combine government intervention with free market principles. In mixed economies around the world, varied levels of government intervention exist.

7 0

2 years ago