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anzhelika [568]
3 years ago
12

Branford has one share of stock and one bond. The total value of the two securities is $1,200. The bond has a YTM of 10.2%, a co

upon rate of 9.2%, and a face value of $1,000; pays semi-annual coupons with the next one expected in 6 months; and matures in 8 years. The stock pays annual dividends and the next dividend is expected to be $24.87 and paid in one year. The expected return for the stock is 15.2%. What is the price of the stock expected to be in 1 year?
Business
1 answer:
riadik2000 [5.3K]3 years ago
8 0

Answer:

The price of the stock is expected to be $188.16 in 1 year.

Explanation:

This can be determined as follows:

Current price of the stock = Expected next dividend / Expected return = $24.87 / 15.2% = $163.62

Expected stock price in 1 year = Current price of the stock * (100% + Expected return)^Number of year = $163.62 * (100% + 15.2%)^1 = $188.16

Therefore, the price of the stock is expected to be $188.16 in 1 year.

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<h3>What is the supply chain management?</h3>

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In conclusion, the primary function of any <u>supply chain management</u> system is to provide the managers with increased visibility of the logistics process.

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4 0
2 years ago
On September 30, Franz Corporation notices a decline in value of its investment in held-to-maturity bonds that it believes to be
never [62]

Answer:

Dr Loss on Impairment $15,520.00

Cr Maturity Debt Securities $15,520.00

Explanation:

Preparation of the journal entry to record the impairment.

Journal entry

Sep. 30

Dr Loss on Impairment $15,520.00

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(To record the impairment)

3 0
3 years ago
Everything else equal, an asset's value is:
Harrizon [31]

Answer:

The correct option is A, an asset's value is inversely related to the rate of return investors require to purchase it

Explanation:

The asset value is the initial purchase price determined by discounting the future cash flows from the asset to present values using a the required rate of return.

Ultimately, the higher the required return, the lower the present value of the investment whose price is being determined and the lower the discount the rate of return used in discounting relevant cash flows to present values the higher the present values.

7 0
3 years ago
Practice: True or False 1. Investment spending is spending on financial assets like stocks and bonds F 2. Transfer payments are
Colt1911 [192]

Answer:

1. False

2. True

3. False

4. False

5. True

6. True

Explanation:

1. False: Investment spending is spending on financial assets like stocks and bonds.

2. True: Transfer payments are not counted in the calculation of GDP.

3. False: If the nominal GDP increases then the economy is definitely experiencing inflation.

4. False: An economy is not at full employment unless there is no unemployment.

5. True: Countries that have generous unemployment benefits tend to have higher natural rates of unemployment. 6. True: Lumberjacks are structurally unemployment when they are replaced by machines.

8 0
3 years ago
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AIDA represents attention, interest, desire and
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The Answer Is Option A, Action
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3 years ago
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