Answer:
In order to find the intrinsic value of a stock using the dividend discount method we need to know its growth rate, its last dividend and its required return. When we know these 3 things we can use them in the formula which is
Intrinsic Value = Dividend*(1+Growth Rate)/(Required return - Growth rate)
In this case we know all three of these values which are
D= 3
G= 3%
R= 17%
We will put these values in the formula in order to find the intrinsic value of the stock
3*(1+0.03)/(0.17-0.03)=22.07
The intrinsic value of the stock is $22.07
Explanation:
Answer:
The correct answer is option c.
Explanation:
An increase in interest rate can be because of an increase in demand for loanable funds or decrease in the supply of loanable funds.
Suppose most businesses decide t modernize and install new equipment. For this, they need to invest more. This will cause an increase in the demand for loanable funds. This increase in demand for loanable funds will be represented by a rightward shift in the demand curve.
This rightward shift will cause the interest rate to increase.
<span>If Imon adding Radar Chart, that would make read the report easier. Radar chart is a graphical method of displaying multivariate data in the form of a two-dimensional chart of three or more quantitative variables represented on axes starting from the same point. That make the report easily understandable.</span>
Answer:
Warranty Expense $3,600 (debit)
Warranty Provision $3,600 (credit)
Explanation:
There is no option on the customer to take the warranty or not.Thus, this type of warranty is called an Assurance type Warranty.
Assurance type Warranties are treated in terms of IAS 37 Provisions as follows :
Warranty Expense $3,600 (debit)
Warranty Provision $3,600 (credit)
Warranty Expense = $120,000 × 3% = $3,600
Answer:
either using its low-cost edge to underprice competitors and attract price sensitive buyers in large enough numbers to increase total profits or refraining from price-cutting and using the low-cost advantage to earn a bigger profit margin on each unit sold.
Explanation:
Competitive advantage is the edge that a firm has over others in the same industry that results in higher profit margins for them.
One of the importance competitive advantages is price advantage.
This results from the firm being a low cost leader. Their cost of production is low enough for them to attract customers that are price sensitive leading to increased profits.
Also they can underprice their competitors or earn profit margins on the reduced cost of production per unit