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lord [1]
3 years ago
11

Using the dividend growth model, explain why a firm would be hesitant to reduce the growth rate of its dividends.

Business
1 answer:
Anna007 [38]3 years ago
4 0

Answer:

If a firm decreases its sustainable growth rate (g), the price of their stock will probably decrease. I will use the following example:

P₀ = Div₁ / (Re - g)

  • Div₁ = $2
  • Re = 12%
  • g = 5%

P₀ = $2 / (12% - 5%) = $28.57

if the growth rate g decreases to 2%, and the rest remains unchanged, then

P₀ = $2 / (12% - 2%) = $20

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Take a stab at this question (you’ll need to do some multiplication). Every day, 500,000 drivers in Los Angeles incur an additio
kirill [66]

Answer / Explanation

Numbers of drivers in Los Angeles that incur an additional 30 minutes of traffic delays = 500000

Neither of the cities

Hence,

L.A. = O.50 hrs. x 500,000 drivers at $15/hr implies a cost of $3,750,000 )  Boston = 0.75 hrs. x 200,000 drivers at $25/hr implies $3,750,000

7 0
4 years ago
An industry that has one large firm that provides 60% of the supply of the product is called an oligopoly.
frez [133]
The statement " An industry has one large firm that provides 60% of the supply of the product is called an oligopoly" is false. 
Because in an oligopoly  more than one firm dominate the market and in monopoly only firm is dominant. In Oligopoly there is small number of firms but have the market share in large majority.
5 0
3 years ago
A mechanic sued his former employer in federal court, claiming that the employer had discharged him because of his age in violat
Olenka [21]

Answer:

The essential facts are unavailable to the mechanic and therefore discovery is required. (Civil Procedure-Motions)

Explanation:

In United States law, the motion to be considered as the procedural device so that it brings the limited and contested issue prior a decision could be taken by the court. It is the request that made to the judge for making out the decision for the case also the party that oppose to the motion should be the non-moving party

So as per the given situation, the important facts are not available to the mechanic and so the discovery is needed

7 0
3 years ago
What type of analysis involves using scales to suit circumstances and allows for quick identification of potential risks as well
Hunter-Best [27]

The correct answer would be, Qualitative Analysis.

Qualitative Analysis involves using scales to suit circumstances and allows for quick identification of potential risks as well as vulnerable assets and resources.

Explanation:

There are two main types of analysis used in the research methodology. One is Quantitative Analysis and the other is Qualitative Analysis. Quantitative Analysis is concerned about mathematical and statistical analysis of the data in the research. Whereas, Qualitative Analysis is the analysis or the understanding of the facts and phenomenons in the research.

Qualitative Analysis help in predicting the potential risks associated in doing something, as well as the identification of vulnerable assets and resources.

Learn more about Qualitative Analysis at:

brainly.com/question/13128569

#LearnWithBrainly

6 0
4 years ago
Preferred stock, 5%, $50 par value, 1,200 shares issued and outstanding with dividends in arrears for the three prior years. Com
Ivenika [448]

Answer:

$12,000

Explanation:

total preferred dividends per year = 1,200 x $50 x 5% = $3,000

since they were not paid during the past three years, and they are cumulative, the total preferred dividends = $3,000 x 4 = $12,000

common stock dividends = total dividends - accumulated preferred dividends = $25,000 - $12,000 = $13,000

cumulative preferred stocks that are not paid in the past, must be paid before any common dividends are paid

8 0
3 years ago
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