Answer:
Stock's current market value = $44.87
Explanation:
We can solve this stock valuation problem using DDM (Dividend Discount Model).
Lets find the dividends for the years:
D0 = $1.32
D1 = $1.32*1.3 = $1.716
D2 = $1.716*1.1 = $1.888
D3 = $1.888*1.05 = $1.982
The formula of stock valuation:
Lets calculate the terminal value after Year 3 afterwards:
<u>Note:</u> rate of return, k_e = 0.09 (given) and growth rate (g) is 5% or 0.05
Now,
The present value of the stocks is gotten using formula:
So, we have:
Stock's current market value = $44.87
Answer:
The answer is risk free rate should be 5.4%
Explanation:
We apply the CAMP model to solve the risk free rate: E(r) = Risk free rate + Beta x ( Market return - Risk free rate).
Denote X as risk free rate; y is market risk premium ( that is market return minus risk free rate)
We have:
For portfolio A: x + 1 * y = 13.4%;
For portfolio B: x + 1.2 * y = 15%
Solving the two equation above, we have: y = 8%; x = 5.4%
So, the risk free rate should be 5.4%.
The reason why the governments used this kind of contract is because they are trying to protect the national security in which could be potentially harm with some instances if they are not careful enough. They are using these in order to prevent such things to occur and to secure their national security.
Solving this problem is pretty straight forward. We simply
have to find for the product of the fraction of the amount of students that
take on a pass or fail basis and the total population. That is:
expected students = 0.03 * 50 students
expected students = 1.5 students
Answer:
<span>1.5</span>
$9.7295 amount of production costs would be assigned to Product A
<h3>What is
production ?</h3>
Production is the process of combining different material and immaterial inputs to create something for consumption. It is the act of producing an output, such as a good or service, that has value and contributes to people's utility.
Land, labor, capital, and entrepreneurship are the four production factors.
Production has six facets, according to Peterson and Anand (2004): technology, law and regulation, industry structure, organizational structure, occupational careers, and market.
The four factors of production are inputs used in various combinations to produce goods and services for a profit. Land, labor, capital, and entrepreneurship are the production factors. They are the supply inputs required.
To know more about production follow the link:
brainly.com/question/16755022
#SPJ4
