Answer:
B)Consult with key competitors about the optimal set of prices to charge, i.e., the prices that will maximize profits for our firm and its competitors.
Explanation:
The financial planning process can be regarded as series of steps which states best way of using money and investments as well as other assets so that financial goals can be potentially achieved. Most of the financial plans has its focus savings of goals as well as payoff goals even estate planning goals so that roadmap to financial freedom can be set.
The steps that can be taken in the financial planning process are;
✓ Forecast the funds that will be generated internally. If internal funds are insufficient to cover the required new investment, then identify sources from which the required external capital can be raised.
✓Develop a set of forecasted financial statements under alternative versions of the operating plan in order to analyze the effects of different operating procedures on projected profits and financial ratios
✓Determine the amount of capital that will be needed to support the plan. e. Monitor operations
Answer: b. The optimal capital structure simultaneously maximizes stock price and minimizes the WACC
Explanation:
The optimal capital structure is simply defined as the capital structure of a company that's made up of debt and equity which helps a business in achieving its aim.
The optimal capital structure simultaneously maximizes stock price and minimizes the WACC. As economic agents always look out to maximize stock price, it should be noted that this can be achieved with a cost of capital that's at its minimum.
Answer:
E(5r5) = 0.06
Explanation:
The expected rate <u><em>(which is the the projected return on a monetary investment)</em></u> on the treasury bonds at 4.05% can be calculated as seen below:
Rate on 5-year Treasury Bonds, E(r5) = 2.20%
Rate on 10-year Treasury Bonds, E(r10) = 4.05%
(1 + E(r5))^5 * (1 + E(5r5))^5 = (1 + E(r10))^10
1.0220^5 * (1 + E(5r5))^5 = 1.0405^10
1.11495 * (1 + E(5r5))^5 = 1.48738
(1 + E(5r5))^5 = 1.33403
1 + E(5r5) = 1.05933
E(5r5) = 0.05933
E(5r5) = 0.06
Answer:
D=$1.52914
The most recent dividend per share paid on the stock is $1.52914.
Explanation:
Formula we are going to use is:
Where:
P is the current selling price
D is he recent dividend per share
g is the growth rate
r is the rate of return
Above formula will become:
D=$1.52914
The most recent dividend per share paid on the stock is $1.52914.