Answer:
a. The stock's price one year from now is expected to be 5% above the current price.
Explanation:
Under gordon model:
If we calculate the value of the stock for the year after that:
to calculate the value of the increase we divide next year over current year.
We have demostrate that next year stock should increase by 1 + growth so statement c is correct.
Answer:
If the economy is at the potential output and the Fed increases the money supply, in the long run real GDP will likely remain the same.
Explanation:
hoped this helped
Answer:
savings per year = $20,500 - $10,500 = $10,000
the loan and interest are not included in the calculation
initial outlay = $50,000
cash flows 1-8 = $10,000
cash flow 9 = $15,000
discount rate = 15%
using a financial calculator, the NPV = -$862.85, and the IRR = 14.53%
Answer:
The company should make the bicycle seats.
Explanation:
Given:
Number of seats to be made = 10,000
Variable cost = 80,000
Fixed cost = 10,000
Outside source cost for seats = $ 8.50 per seat
Since, the fixed cost of the seats cannot be eliminated. Therefore, the deciding factor will only be the variable cost.
Thus,
contribution margin per unit seat if made by own
= ( Variable cost / Number of seats )
Or
= 80,000 / 10,000
or
= $ 8
now,
the making the seats by own is $ 0.5 cheaper.
Hence, the company should make the bicycle seats.
