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3 years ago

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A stock is trading at $80 per share. The stock is expected to have a year-end dividend of $4 per share, which is expected to gro

w at some constant rate g throughout time. The stock's required rate of return is 14%. If you are an analyst, what would be your forecast of g

1 answer:

8_murik_8 [283]3 years ago

3 0

Answer:

Explanation:

94 dollars

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Timothy periodically purchases bonds issued by Prince Waste Collection. Last year, he bought two bonds in February, two bonds in

My name is Ann [436]

Answer:

$344.22

Explanation:

Calculation to determine how much profit did he make from buying and selling these bonds

First step is to calculate how much Timothy invested in February, June and August

February=2 x $1,000 x 94.593%

February = $1,891.86

June= 2 x $1,000 x 92.661%

June= $1,853.22

August= $1,000 x 105.48%

August = $1,054.80

Total investment = $4,799.88

($1,891.86+$1,853.22+$1,054.80)

Seconds step

Since Timothg sold 5 bonds in the month of October at 102.882 each which means he will received:

Amount received= 5 x $1,000 x 102.882%

Amount received= $5,144.10

Now let determine his Total profit

Total profit = $5,144.10 - $4,799.88

Total profit= $344.22

Therefore how much profit did he make from buying and selling these bonds will be $344.22

4 0

3 years ago

Consider the role of management accounting in relation to the company for which you work (or have worked). Discuss how the princ

kotegsom [21]

Answer:

Role of management accounting :

1. provide internal information on operations

2. help in decision making

Utilization of management accounting principles

1. make or buy decisions

2. continuing or discontinuing of operations

Useful managerial Accounting Activities

1. planning

2. deciding on the alternative causes of action

Explanation:

Role of Management Accounting is to provide managers with information related to their operations.This includes the costs and revenue incurred, the deviations from the planned costs and revenue and profit targets.

This information would help to control costs and revenues or make certain decisions of continuing or discontinuing operating of a product or segment.

Thus managerial accounting activities that are useful are planning, deciding on the alternative causes of action, implementation, monitoring and control

7 0

3 years ago

A firm is considering the purchase of an asset whose risk is greater than the current risk of the firm, based on any method for

Anika [276]

Answer:

e) Increase the required rate of return used to evaluate the project to reflect the higher risk of the project

Explanation:

As per the basic concept of investment, "higher the risk, higher the return".

Thus, an investor assumes a higher risk only in the scenario wherein the expected return would be commensurate with such risk. Investor would only invest in a risky asset when the return derived can compensate him for the excess risk assumed.

Required rate of return is an investors expectation of return from a project also referred to as the cost of capital.

So for the purpose of evaluating the project, the investor should use a higher required rate of return to signify higher risk which would reveal the true viability of the project.

8 0

3 years ago

Yummy Bakery just paid an annual dividend of $3.40 a share and is expected to increase that amount by 2.2 percent per year. If y

Oxana [17]

Answer:

$28.18

Explanation:

Use dividend discount model to answer this question.

Current dividend ; D0 = 3.40

growth rate; g = 2.2% or 0.022 as a decimal

D1 = D0(1+g)

D1 = 3.40(1.022)

D1 = 3.4748

Since you are buying the stock next year, calculate dividend at year 2 which you would use in the formula to find next year's price (P1) ;

D2 = D1(1+g)

D2 = 3.4748 (1.022)

D2 = 3.5512

Next year's price; P1 = D2 / (r-g)

P1 = 3.5512 / (0.148 - 0.022)

P1 = 28.1841

Therefore, you will pay $28.18

8 0

3 years ago

Corruptco is a large machine shop that fabricates metals. Corruptco maximizes profits and shareholder value by polluting the loc

masha68 [24]

Answer: a. the narrow view, or invisible hand theory

Explanation:

When it comes to the narrow view theory of corporate social responsibility, companies put one thing above all else, the maximisation of shareholder wealth.

Any activity that would help them do so - legally - is considered fair game even if it leads to adverse effects. Corruptco is therefore adhering to this theory because they are polluting the the local river to maximize shareholder value.

6 0

3 years ago