Answer:
The stock market tends to value diversified companies at less than their break-up value.
Explanation:
Conglomerate discount is only applicable to large, highly diversified business entities and it basically arises as a result of business analysts having difficulty finding an appropriate way to value group of businesses with complex financial statements.
Simply stated, the expression "conglomerate discount" means that the stock market tends to value diversified companies at less than their break-up value.
Hence, when a vast array of businesses aren't performing optimally as the overall conglomerate or there are issues with respect to its core values and financial statements, business analyst may have to apply the conglomerate discount concept.
In order to calculate the conglomerate discount, business experts add up various estimations of the intrinsic values associated with the respective subsidiary firms in a conglomerate and lastly, the market capitalization of the conglomerate is subtracted from that sum. Intrinsic value refers to a measure of the underlying value of a firm and its cash inflow.
Also, it's worthy of note that the sum of the various estimations is typically greater than the conglomerate stock values.
Idk this but u can google it and the answer would be right there
Answer:
the options are missing:
- Always accept Project A.
-
Accept Project B if the required return is less than 13.1 percent.
- Be indifferent to the projects at any discount rate above 13.1 percent.
- Accept Project B only when the required return is equal to the crossover rate.
- Always accept Project A if the required return exceeds the crossover rate.
the answer is:
5. Always accept Project A if the required return exceeds the crossover rate.
The crossover point tells us that one project must be chosen if the IRR is higher than the cross over point, but if the IRR is lower, then the other alternative should be selected.
In this case, the cross over point is 12.3% and we are told that project A should be selected if the required IRR is 13.1%. That tells us that the alternative that we must choose above 12.3% is project A. Project B should be selected if the IRR is less than 12.3%.
Answer: $27.90
Explanation:
Discount the dividends and the price you will sell the stock at in 4 years at 12%.
The dividends are a constant and so can be treated as annuities.
= (5 * Present value factor of annuity, 4 years, 12%) + 20/(1 + 12%)⁴
= (5 * 3.0373) + 12.71036
= $27.90
Answer: Distribution channel
Explanation:
A distribution channel is one of the type of business process in which the products are get transferred or move from the producer to the customer or the business users.
The distribution channel is basically refers to the business chain in which the various types of products and the services are reaches to the consumer. The distribution channel mainly include are as follows:
- Distributors
- Wholesalers
- Retailers
Therefore, Distribution channel is the correct option.