1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
sertanlavr [38]
3 years ago
9

The Felix Corp. will pay an annual dividend of $1.00 next year. The dividend will increase by 12 percent a year for the followin

g two years before growing at 4 percent indefinitely thereafter. If the required rate of return is 10 percent, what is the stock’s current value?
Select one:

a. $13.38
b. $14.05
c. $19.11
d. $9.80
e. $10.38
Business
1 answer:
Vitek1552 [10]3 years ago
6 0

Answer:

c. $19.11.

Explanation:

The Felix Corp current stock value will be determined by using formula:

D1 / (1 + r) ^ 1 + D2 / (1 + r) ^ 2 + D3 / (1 + r) ^ 3 + D4 / (1 + r) ^ 3

It has paid dividend of $1.00 which will grow at 12% per year for 2 years and at 4% indefinitely after 2 years.

D1 = $1.00

D2 = $1.00 * 1.12 = $1.12

D3 = $1.12 * 1.12 = $1.25

D4 = ( $1.25 * 1.04 ) / (0.10 - 0.04) = $21.67

Using formula the stock value will be:

$1.00 / 1.10 + $1.12 / (1.10)2 + $1.25 / (1.10)3 + $21.67 / (1.10)3

Current stock value = $19.11.

You might be interested in
If beginning inventory is $60,000, cost of goods purchased is $380,000, and ending inventory is $50,000, cost of goods sold is $
k0ka [10]

Answer:

390,000

Explanation:

The cost of goods sold is the expense incurred in producing goods to be sold in a period. It is abbreviated as COGS.

The cost of goods sold is calculated using the formula

COGS = opening stock + purchase/ cost of goods manufactured - ending stock

In this case:

Beginning  stock = $60,000

Ending stock =$50,000

Cost of goods manufactured $380,000

COGS= $60,000 + $380,000- $50,000

COGS = $390,000

5 0
3 years ago
Assuming that a marketing research study will answer important questions and reduce uncertainty associated with the proposed pro
scoray [572]

Answer:

The correct answer is C. Is top management committed to the study?

Explanation:

Market research is the process that includes the actions of identification, collection, analysis and dissemination of information with the purpose of improving marketing decision making. Its implementation occurs basically for two reasons:

1. to solve problems, for example, determine the potential of a market.

2. to identify problems, for example, to know why a product does not have the expected consumption. In essence, it seeks to meet the customer thus complying with the first premise of marketing.

That is why managers and researchers continually focus on the search for those practices that will allow them to improve the organization and direction of their processes and therefore increase their likelihood of success.

7 0
3 years ago
Google Ads was constructed around three core principles, focused on helping businesses reach their online potential. The first o
tia_tia [17]
Yes helpful information
4 0
3 years ago
11. What are assets?
vampirchik [111]
Financial accounting, an asset is any resource owned by a business or an economic entity. It is anything that can be owned or controlled to produce value and that is held by an economic entity and that could produce positive economic value.
I hope this helps
7 0
3 years ago
Read 2 more answers
The population p, in millions, of a certain country can be calculated by p=0.83t54, where t is the time in years, and t = 0 repr
dalvyx [7]
P(t) = (0.83)t^(5/4) 
<span>2096 - 2015 = 81 </span>
<span>81 ^ (5/4) = 243 </span>
<span>243 × 0.83 = 201.69 </span>

<span>Population in 2096 expected to be 202 million.</span>
3 0
2 years ago
Other questions:
  • You have​ $675 today which is enough to buy 375 bottles of Diet Pepsi. If the price of Diet Pepsi is expected to increase by​ 4%
    9·1 answer
  • The Work-in-Process inventory account of a manufacturing firm shows a balance of $4,090 at the end of an accounting period. The
    15·1 answer
  • Suppose you had a large unpaid balance on your credit card and were paying a high rate of interest. You then received a​ one-tim
    6·1 answer
  • Foyert Corp. requires a minimum $6,900 cash balance. If necessary, loans are taken to meet this requirement at a cost of 2% inte
    12·1 answer
  • Research suggests that people just care about getting a paycheck out of their jobs.
    10·1 answer
  • Phil deposits his money in the bank and earns _____. The bank uses part of Phil's money to make _____.
    8·2 answers
  • Kia, a top-level manager in a software firm, is allocating the company's resources to meet the organization's long-term goals. S
    9·1 answer
  • As a discipline, Governance is most closely related to:
    12·1 answer
  • Dana believes that a new phone to be sold by Ear Fruit Inc. will become the most popular phone in the global market. Dana enters
    10·1 answer
  • What type of changes are not usually included within the scope of change management?
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!