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avanturin [10]
3 years ago
15

Bonita Corporation had net income of $1550000 and paid dividends to common stockholders of $400000 in 2017. The weighted average

number of shares outstanding in 2017 was 387500 shares. Bonita Corporation's common stock is selling for $48 per share on the NASDAQ. Bonita Corporation's price-earnings ratio is
Business
1 answer:
artcher [175]3 years ago
3 0

Answer:

16 times

Explanation:

Calculation to determine what Bonita Corporation's price-earnings ratio is

Price-earnings ratio= ($1550000 -$400000)/387500

Price-earnings ratio=$1,150,000/387500

Price-earnings ratio=2.97

Price-earnings ratio= 48/2.97

Price-earnings ratio=16 times

Therefore Bonita Corporation's price-earnings ratio is 16 times

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Barbara went to a business dinner, and unlike her colleagues who simply placed orders for "red" wine, Barbara requested a bottle
const2013 [10]

Answer:

Cultural capital

Explanation:

Cultural capital consists of knowledge about artistic trends and cultural acts that one can use to establish oneself in society, and demonstrate a particular social-standing. It also consists of tastes, preferences, and even ways of speaking, living, and moving.

The term was coined by French sociologist Pierre Bordieu. According to him, cultural capital is a form of class distinction, because the access to certain cultural products depends on variables such as race, ethnicity, income, sex, and religion.

4 0
3 years ago
Suppose you held a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolio'
Solnce55 [7]

Answer:

What would your portfolio's new beta be? 2,04

Explanation:

"To calculate the ending Beta by changing one stock it's necessary to find how much weigh the stock we are removing from the portfollio.

7.500 / 150.000 = 0,050 , now we have the participation of the stock in the portfolio, then we weigh the beta of the stock we want to remove by this number, 1,00 (Beta) x 0,050 (weight in the portfolio) = 0,050 (Beta), the number it's the same as the weight because the Beta is 1,00.

Now with this final number we can ponderate the new Beta in the Portfolio, so we multiply the 0,50 (weight) * 0,75 (New Beta) = 0,038 New Beta. We substitute the beta we remove for this one and we get the NEW BETA PORTFOLIO of 2,04. Please see details below:

Portfolio  #   Beta    NEW Beta   Weight  Old Beta   New Beta  

$ 7.500 1  1,00   0,75   0,05   0,05   0,04  

$ 7.500 2  2,05   2,05   0,05   0,10   0,10  

$ 7.500 3  2,05   2,05   0,05   0,10   0,10  

$ 7.500 4  2,05   2,05   0,05   0,10   0,10  

$ 7.500 5  2,05   2,05   0,05   0,10   0,10  

$ 7.500 6  2,05   2,05   0,05   0,10   0,10  

$ 7.500 7  2,05   2,05   0,05   0,10   0,10  

$ 7.500 8  2,05   2,05   0,05   0,10   0,10  

$ 7.500 9  2,05   2,05   0,05   0,10   0,10  

$ 7.500 10  2,05   2,05   0,05   0,10   0,10  

$ 7.500 11  2,05   2,05   0,05   0,10   0,10  

$ 7.500 12  2,05   2,05   0,05   0,10   0,10  

$ 7.500 13  2,05   2,05   0,05   0,10   0,10  

$ 7.500 14  2,05   2,05   0,05   0,10   0,10  

$ 7.500 15  2,05   2,05   0,05   0,10   0,10  

$ 7.500 16  2,05   2,05   0,05   0,10   0,10  

$ 7.500 17  2,05   2,05   0,05   0,10   0,10  

$ 7.500 18  2,05   2,05   0,05   0,10   0,10  

$ 7.500 19  2,05   2,05   0,05   0,10   0,10  

$ 7.500 20  3,10   3,10   0,05   0,15   0,15  

$ 150.000               1,000   2,05   2,04  

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

7 0
3 years ago
You work for a pharmaceutical company that has developed a new drug. The patent on the drug will last 1717 years. You expect tha
Svetlanka [38]

Answer: The present value of the new drug is $19.33 million

We follow these steps to arrive at the answer:

Expected Revenues from the drug in year 1(P)   $2 million

Growth Rate (g)                                                        2% p.a.

No. of years  (n)                                                      17 years  

Discount rate (r)                                                        9% p.a.

Since the revenues are expected to grow at a constant rate of 2% p.a, we can treat this series of cash flows as a <u>growing annuity. </u>

We calculate the Present Value of a growing annuity with the following formula:

PV = \frac{P}{r-g}*\left [ 1- \left (\frac{1+g}{1+r}\right)^{n}\right]

Substituting the values we get,

PV = \frac{2}{0.09-0.02}*\left [ 1- \left (\frac{1+0.02}{1+0.09}\right)^{17}\right]

PV = \frac{2}{0.07}*\left [1- 0.323558233\right]

PV = 28.57142857 * 0.676441767

PV = 19.32690763

8 0
2 years ago
A company estimates that an average-risk project has a WACC of 10 percent, a below-average-risk project has a WACC of 8 percent,
prisoha [69]

Answer:

B) Project B has below-average risk and an IRR = 8.5 percent.

Explanation:

Since the evaluation is based on IRR, use IRR rule that says you accept a project if its IRR > Cost of capital(WACC in this case)

Project A's IRR of 9% is < 10% WACC for average risk projects hence reject it.

Project B's IRR of 8.5% is > 8% WACC for below- average risk projects hence accept it.

Project C's IRR of 11% is < 12% WACC for above- average risk projects hence reject it.

8 0
3 years ago
Firm X and Firm Y both sell the same products at the same price; both firms are the same size with identical sales levels; Firm
Vika [28.1K]

Answer:

The options are given below:

A. Firm X

B. Firm Y

C. Same variability of operating profits

D. It would depend on tax effect on taxable income

The correct option is B. Firm Y

Explanation:

This is because firm Y has a higher operating leverage than firm X.

<u>Operating Leverage</u> refers to a cost-accounting formula that measures the degree to which a firm can increase operating income by increasing revenue. Operating leverage actually boils down to the analysis of fixed costs and variable costs, and it is highest in companies that have a high fixed operating costs in comparison with variable operating costs. What this means is that this kind of company makes use of more fixed assets. On the other hand, operating leverage is lowest in companies that have a low fixed operating costs when compared with variable operating costs.

Companies with high operating leverage are capable of making more money from each additional sale if they do not have to incur more costs to produce more sales.

Therefore, from the scenario given above, we can conclude that firm Y has a higher operating leverage than firm X, because firm X has lower fixed costs than firm Y, and a higher variable cost than firm Y as well. Hence, firm Y has the potential to make more operating profits from its business activities.

4 0
3 years ago
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