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Brut [27]
3 years ago
13

Locked-In Real Estate (LIRE) is preparing for their Initial Public Equity Offering (IPO). With its holdings consisting of rent c

ontrolled apartments, and no plans for expanding, LIRE plans to payout all of its earnings as dividends. These dividends amount to $7.50 per share, forever. If the expected rate of return is 12%, what is the stock price of LIRE
Business
1 answer:
jeka57 [31]3 years ago
4 0

Answer: $62.50

Explanation:

The stock price of Locked-In Real Estate (LIRE) will be calculated thus:

Stock price = D /ke - g

where,

D = Dividend paid per share = $7.50

Ke = expected rate of return on equity = 12% = 0.12

g is growth rate of dividend = 0

Stock price = $7.50/0.12

Stock price = $62.5

Therefore, the stock price is $62.50

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If a CobbDouglas production function has alpha​ = 0.34 and beta​ = 0.42, then a​ 1% increase in inputs results in a​ ________ ch
vampirchik [111]

Answer:

0.76%

Explanation:

Firstly we write out the production function to be

Y = K^0.34L^0.42.

So if we have inputs that are increased by 1%, we will now have a new production function which is

Y = (K + 0.01 of K)^0.34 (L + 0.01 of L)^0.42

We write this in terms of growth rate

The Growth rate of Y = 0.34 x the growth rate of K + 0.42 x the growth rate of L

This gives us the Growth rate of Y = 0.34 x 1% + 0.42 x 1%

= 0.34+0.42

= 0.76%

6 0
3 years ago
Last year, Cayman Corporation had sales of $7,000,000, total variable costs of $3,000,000, and total fixed costs of $1,500,000.
UNO [17]

Answer:

b. 13.9%

Explanation:

sales                   7,000,000

variable cost   <u>  (3,000,000)  </u>

contribution       4,000,000

fixed cost           (1,500,000)

interest              <u>   (480,000)  </u>

EBT                     2,020,000

tax expense          (707,000)

net income           1,313,000

contribution margin 4,000,000 / 7,000,000 = 4/7

if sales increase by 7%:

7,000,000 x 0.07 x 4/7 x (1- 0.35) = 182,000

income after increase in sales: 1,313,000 + 182,000 = 1,495,000

increase in earnings: 1,495,000 / 1,313,000 - 1 = 0.138613861 = 13.9%

3 0
3 years ago
Best Foods Company is considering expanding beyond the regional market segments now served by its Hellmann's mayonnaise. One cri
LenaWriter [7]

Answer:

A. Best Food's competitive position in the segment

Explanation:

Best Food's competitive position in the segment is an example of the criterion used to select target market segments.

It would be used by the management to evaluate and analyze potential new geographic market segments in order to know whether new equipment must be bought to serve each new segment.

7 0
4 years ago
Read 2 more answers
Investors select a stock based on the cash they expect to receive from that stock. that cash comes in the form of?
mylen [45]

Investors select a stock based on the cash they expect to receive from that stock. that cash comes in the form of a and b.

Investors are usually different from traders. Investors invest capital for long-term gains, while traders buy and sell securities repeatedly in pursuit of short-term gains. Investors typically generate income by investing capital in either stocks or debt.

So how does an investor choose which stocks to buy?He has two main investment styles: active and passive. Active investors try to outperform the market by buying stocks that they believe are undervalued, with the intention of selling when the stock price rises.

Stock pick. An active portfolio management approach that focuses on a favorable selection of specific stocks rather than broad asset allocation.

Learn more about stock here: brainly.com/question/25818989

#SPJ4

The question is incomplete. Please read below to find the missing content.

Investors select a stock based on the case they expect to receive from that stock. That cash comes in the form of ____.

a. Dividends

b. The future sales price.

c. Interest payments.

d. Commissions.

7 0
2 years ago
Given that they often competen t powerful companies, it is imperative that entrepreneurs:
Step2247 [10]

Answer:

Use strong judicial tools as patents and copyrights. Be flexible to enter the market. Understand that is more expensive to acquire a new client that to maintainn and excisting one.

Explanation:

The powerfull companies can make a product or service look bad (sabotage) or can change its prices to eliminate possible competitors from the market, they also have a huge share of the market so there are not many avilable new clients to gain.

3 0
3 years ago
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