Answer:
The airport should invest a uniform amount of
$357,958.55
Explanation:
Hi
First of all, we need to know how much will cost the land in five years so we have,
, that means that the future value of the land will be $2'100,000.
Now we can use
with
and
%, so we have ![A=\frac{2100000}{\frac{(1+008)^{5} -1}{0.08} }=357958.55](https://tex.z-dn.net/?f=A%3D%5Cfrac%7B2100000%7D%7B%5Cfrac%7B%281%2B008%29%5E%7B5%7D%20-1%7D%7B0.08%7D%20%7D%3D357958.55)
Answer:
$29.70
Explanation:
Retention ratio = 1 - payout ratio
= ( 1 -0.5 )
= 0.5
Growth rate, g = ROE × Retention ratio
= 0.15 × 0.5
= 0.075
= 7.5%
Required return = Risk - free rate + [ Beta × (Market rate- risk-free rate) ]
= 2.5% + 1.44 × (11% - 2.5%)
= 14.74%
Intrinsic value = ![\frac{\textup{D1}}{\textup{(Required return-Growth rate) }}](https://tex.z-dn.net/?f=%5Cfrac%7B%5Ctextup%7BD1%7D%7D%7B%5Ctextup%7B%28Required%20return-Growth%20rate%29%0A%7D%7D)
=![\frac{\textup{2}\times(1+0.075)}{\textup{(0.1474-0.075) }}](https://tex.z-dn.net/?f=%5Cfrac%7B%5Ctextup%7B2%7D%5Ctimes%281%2B0.075%29%7D%7B%5Ctextup%7B%280.1474-0.075%29%0A%7D%7D)
= 29.69 ≈ $29.70
Answer:
it shouldn't violate historic cost principal because it is not going to shut down it's business so therefore it should value the assets on the market price not on the cost of purchase price
Explanation:
above is the explanation,you should think of the answers and so doing your hw from this app.
D and E are be the correct answers