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Serhud [2]
3 years ago
9

1. How much would you pay for a share of stock paying a dividend​(cash payout ​C) of ​$4 to be paid in one​ year, a known sellin

g price in one year ​(​P) of ​$50​, and expected return ​(R) of similar assets of 2​%?2. Compute the price of a share of stock that pays a​$1.50 per year dividend and that you expect to be able to sell in one year for ​$20, assuming you require a 10​% return.
Business
1 answer:
Mnenie [13.5K]3 years ago
8 0

Answer and Explanation:

The computation is shown below:

a. The willing to pay is

= (Current year price) ÷ (1 + rate) + (current year dividend) ÷ (1 + rate)\

= ($50) ÷ (1 + 0.02) + ($4) ÷ (1 + 0.02)

= $52.94

b. The price of a share is

= (Current year price) ÷ (1 + rate) + (current year dividend) ÷ (1 + rate)\

= ($20) ÷ (1 + 0.10) + ($1.50) ÷ (1 + 0.10)

= $19.55

We simply applied the above formula so that the correct value could come

And, the same is to be considered

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FOB <u>destination</u> is the term used when ownership of the goods transfers to a buyer when the goods arrive at the buyer's place of business.

<h3>What is FOB destination?</h3>

FOB which full meaning is freight on board is a form of goods or product shipment in which the seller is fully incharge or in possession of the goods until the goods reach the buyer destination in which  the ownership of the goods is then transfers to a buyer.

Once the ownership of the goods transfers to a buyer, this means that the buyer is the owner of the goods and is liable for any damage that occur to the goods.

Inconclusion FOB <u>destination</u> is the term used when ownership of the goods transfers to a buyer when the goods arrive at the buyer's place of business.

Learn more about FOB destination here:brainly.com/question/24976258

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2 years ago
A what is when a group of companies illegally work together and essentially create a monopoly in order to increase prices and th
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A cartel is when a group of companies illegally work together and essentially create a monopoly in order to increase prices and their profits.

8 0
3 years ago
An example of the ___________ effect is when BMW gained in-depth information about visitors to a popular Chinese social media si
Bezzdna [24]

Answer:

information effect.

Explanation:

Based on the information provided within the question it can be said that the effect being illustrated in this scenario is known as the information effect. This term refers to when a company obtains confidential information that allows them to make specific decisions to drastically increase their position within the market. Such as BMW is doing by using the information to target the correct population segment within the market.

5 0
3 years ago
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A firm produces and sells two products, Plus and Max. The following information is available relating to setup costs (a part of
Reika [66]

Answer:

$4 and $4

Explanation:

The computation are shown below:

Per hour cost = Total set up cost ÷ Total direct labor hours

                          = $64,800 ÷ $81,000

                          = $0.8

Now the set up cost would be

= Per hour cost × Direct labor hours per unit

For Plus

= 5 × $0.8

= $4

For Max

= 5 × $0.8

= $4

All other given information is not important. Hence, ignored it

4 0
3 years ago
Suppose that the United States and Canada both produce only two products, televisions and food. The United States can produce 10
algol13

Answer:

Option A. Two - Third of a television

Explanation:

Using Unitary Method,

Here, the opportunity cost of producing 150 pounds of food in US = 100 televisions

Similary the opportunity cost of producing 1 pound of food in US = 100 / 150 televisions = 0.66 televisions = 2/3 televisions

So the right option is A.

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3 years ago
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