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
Olenka [21]
2 years ago
7

When assuming nonconstant growth in dividends, to avoid the problem of having to forecast and discount an infinite number of div

idends, we must require that the dividends _____.
Business
1 answer:
Sergio039 [100]2 years ago
4 0

To avoid the problem of having to forecast and discount an infinite number of dividends, we must require that the dividends start to grow at a fixed rate in the future.

<h3>What are dividends?</h3>

Dividends are payments made by a company to its shareholders. This money is taken from the total profits made by the company. The remaining money after the payment of dividends goes to re-investment in order to grow the company.

Therefore, we can confirm that in order to avoid the problems presented in the question regarding dividends, we must require that they grow at a fixed rate in the future.

To learn more about profit visit:

brainly.com/question/1494270?referrer=searchResults

You might be interested in
You can buy property today for $2.2 million and sell it in 5 years for $3.2 million. (You earn no rental income on the property.
Stolb23 [73]

Answer:

PV of the sales price  $1,986,948.23

 

Explanation:

We will calcualte the present value of the sale price using the present value of a lump sum formula:

\frac{Maturity}{(1 + rate)^{time} } = PV  

Maturity 3,200,000

time                         5 years

rate         10% = 10/100 = 0.1

\frac{3200000}{(1 + 0.1)^{5} } = PV  

PV        $1,986,948.2338  

This indicates the 3,200,000 in five years are equivalent to 1,986,948.23 dollars Thus, this investment is not profitable as the property will be purchased at 2,200,000

7 0
2 years ago
E25-18 Making outsourcing decisions Cool Systems manufactures an optical switch that it uses in its final product. The switch ha
Vikentia [17]

Answer:

From a cost savings perspective the switch should be made in-house

Explanation:

In deciding whether Cool Systems should make or buy the switch , we calculate the relevant applicable to  both situations,then compare t see which option saves costs.

The cost of making the switch is calculated thus:

Direct materials per unit      $5

Direct labor                           $3

Variable overhead                <u>$6</u>

Total relevant cost               <u> $14</u>    

The cost of purchasing the switch from another supplier is $15

From the above analysis, it is preferable to make the switch in-house as that option saves $1($15-$14) per switch.

However, it might be that we need to look beyond cost savings sometimes,purchasing the switch from another supplier might be viable if the quality of the outside switch is better or that the outside supplier can deliver in timely fashion.      

7 0
2 years ago
Product X-547 is one of the joint products in a joint manufacturing process. Management is considering whether to sell X-547 at
Katena32 [7]

Answer:

b. 1,2,3,4

Explanation:

Lets first understand what relevant cost is? Relevant cost is any cost that influences the decision of a decision maker. Therefore, the first four items are relevant in the decision of whether to sell the X-547 or to further process it.

Explanation for each item is as follows:

1- Selling price of X-547:

The selling price is relevant because it will help to determine the revenue generated from selling X-547 at the split off point and which could also be used for comparative purposes, if suppose the decision of further processing is chosen.

2- Variable cost of processing X-547 into Xylene:

The variable cost of processing X-547 is indeed relevant too, because at this stage management is not in a position to take a decision until they explore the possibilities coming out of processing X-547, therefore, in order to come to a decision making position the management will need to know the variable cost of processing X-547, making it relevant in the decision.

3- The avoidable fixed costs of processing X-547 into Xylene:

There is sometimes a fear (i.e fear of increase in step-fixed costs as a result of processing a product or fear of loss of control over costs) felt by the management when trying to process certain products for further development therefore those fixed costs which can be avoided during processing X-547 can also influence (i.e encourage) the decision of further processing X-547, making it relevant.

4- The selling price of Xylene:

The last but not the least, the selling price of Xylene. If the management finds that if X-547 is further processed into Xylene and it sells at a highly favorable/lucrative price, creating a huge margin for them then definitely they would be encouraged to taking the decision of further processing it.

5 0
3 years ago
Dew wanted to create a campaign based on its core concept of diy. they ran multiple contests and created nations and communities
ruslelena [56]
By doing this, Dew was able to create a stronger bond with the customer and their brand. They already have brand awareness with their customers but now they are able to engage their customers by allowing them to have a "say" in their products. They are letting them design a product they would like to see on the market and become a part of the brand/company.
8 0
3 years ago
Emily, age 58, has been a participant in the Icon, Inc. ESOP for fifteen years. She plans to retire at 65. At the end of this ye
Andrej [43]

Answer:

How much must Icon allow Emily to diversify this year?

The answer is $250,000

Explanation:

  • After attaining the age of 55 years and participating already for ten years in the ESOP.
  • Emily will be allowed to diversify the value equal to 25% of investments.
  • 50% of the investment is allowed to be diversified if it is final year of participation but in the present case it is not the final year before the retirement of the Emily so she will not be allowed 50% diversification and only up to 25% is allowed on which the percentage of investment already diversified in previous years will also be reduced.
  • Since here in the past no amount has been diversified by Emily so she will be allowed 25 % of investment to diversify in the current year which comes to $250,000 ($1,000,000* 25%). Thus the answer is $250,000.
7 0
2 years ago
Other questions:
  • Lisette is excited about her new home in Rome. She has been given the opportunity to learn about a new culture, form new friends
    8·1 answer
  • Which of the following is true about product​ markets?
    12·1 answer
  • Abc toys, a u.s.-based toy manufacturer, has set up a manufacturing plant in hong kong. this is an example of
    15·1 answer
  • The process of alliance management begins with
    7·1 answer
  • 17 Select the correct answer. Which characteristic best describes organizational buying? A. The market contains huge numbers of
    6·1 answer
  • Assume Canada has a financial account of negative 40 billion Canadian​ dollars, and its capital account is 10 billion Canadian d
    7·1 answer
  • During 2019, Travis purchases $13,000 of used manufacturing equipment (7-year property) for use in his business, his only asset
    10·1 answer
  • "A customer places an order to sell 100 shares of ABC at the market. The initial execution report shows the trade occurring at $
    12·1 answer
  • Prepare journal entries to record the following transactions entered into by the Merando Company: 2016 June 1 Received a $10,000
    9·1 answer
  • Based on the balance
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!