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xenn [34]
3 years ago
12

Toy Mart recently announced that it will pay annual dividends at the end of the next two years of $1.60 and $1.10 per share, res

pectively. Then, in Year 5 it plans to pay a final dividend of $13.50 a share before closing its doors permanently. At a required return of 13.5 percent, what should this stock sell for today
Business
1 answer:
Delicious77 [7]3 years ago
6 0

Answer:

$9.43

Explanation:

Calculation for what should this stock sell for today

Stock today = $1.60/1.135 + $1.10/1.135^2 + $13.50/1.135^5

Stock today = $9.43

Therefore what should this stock sell for today is $9.43

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While the evidence suggests that over long periods of time that stocks will outperform bonds, individuals with a long-term inves
Scrat [10]

Answer:

Stocks and Bonds

Yes.  It is a rational behavior for individuals with a long-term investment horizon to choose to invest in bonds rather than investing in stocks despite the overwhelming "evidence that suggests that over long periods of time stocks still outperform bonds."

Rational behavior involves making rational choices that provide optimal levels of benefit or utility for the individual. People who make rational choices would rather choose bonds with lower risks and returns than stocks with higher risks and returns.

Explanation:

Every rational investor would prefer to reduce her risk exposure instead of increasing it.  Every investor is also aware that  investments with higher risks attract higher returns.  However, determining the certainty of the returns is difficult.

4 0
3 years ago
Why would the federal reserve enact an easy money policy
kirza4 [7]

Answer:

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Explanation:

5 0
2 years ago
You are interested in understanding how clicks lead to a sale on your site. what do you call a click that leads to a sale on you
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3 years ago
From 1948 to 2003 the United States experienced an average real GDP growth rate of 3.5 percent and Guatemala had an average real
Luda [366]

Answer:

No, we can’t say

Explanation:

In this question, we are asked to decide if we can say that Guatemala’s standard of living grew more than that of the US’ standard of living between the years 1993 and 2003 given the pointers in the question.

We cannot say that this is correct because of the following reasons;

As observed from the question, the US growth rate was calculated between the years 1948-2003, which is indicative of a 55 year span. Now, comparing this with that of Guatemala, we can see that the span here is just 10 years I.e from 1993 to 2003.

Also, we were not provided with the population growth rate in both countries and this makes it difficult to judge which of the two countries have a better growth in terms of standard of living

5 0
3 years ago
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The benefits of effective listening are:
den301095 [7]
One benefit is that you are helping the other person talk through there problems

strengthen your relationship with that person

Making the other person feel appreciated

Hope this helps you have a great night!!!
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3 years ago
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