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Lady_Fox [76]
2 years ago
7

PLEASE HELP ASAP 10 min left

Business
1 answer:
amm18122 years ago
4 0

Answer:

its b

Explanation:

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On December 31, 2020, Buffalo Company signed a $1,278,400 note to Carla Bank. The market interest rate at that time was 10%. The
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4 0
3 years ago
The stock price of Baskett Co. is $53.40. Investors require a return of 12 percent on similar stocks. If the company plans to pa
Gemiola [76]

Answer:

Growth Rate = 5.73%

Explanation:

The present value of stock formula can be used here to solve this problem.

The formula is:

P_0=\frac{Div_1}{r-g}

Where

P_0  is the current stock price

Div_1  is the dividend to be paid next year

r is the rate of return required

g is the growth rate expected

Now, the first 3 variables are given, we need to find g. Substituting, we find our answer:

P_0=\frac{Div_1}{r-g}\\53.40=\frac{3.35}{0.12-g}\\53.40(0.12-g)=3.35\\6.408-53.40g=3.35\\53.40g=3.058\\g=0.0573\\

In percentage, it is

<u>Growth Rate = 5.73%</u>

7 0
3 years ago
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