Answer:
The price of the stock today is $54.61
Explanation:
The stock of this company pays a constant dividend for a defined period of time after equal intervals. Thus, it is just like an annuity. To calculate the price of such a stock, we will use the present value of annuity formula:
Assuming that the dividend is paid at the end of the period.
Present Value of Annuity = Dividend * [(1 - (1+r)^-n) / r]
Where,
- r is the required rate of return
- n is the number of years of annuity
The price of the stock today is,
P0 = 8.45 * [(1 - (1+0.13)^-15) / 0.13]
P0 = $54.607 rounded off to $54.61
Answer:
b. She receives $10,000
Explanation:
Taxes owed = (1/4 of income) - $15,000.
Taxes owed = (1/4 x 20,000) - $15,000.
= 5,000 - 15,000 => -10,000
Hence, she receives $10,000 from the government.
A negative income tax is a system where people earning below a certain amount receive supplemental pay from the government instead of paying taxes to the government.
Answer:
I don't know
Explanation:
Prepare a narrated PowerPoint presentation that will highlight the following items.
a. Your calculations for the amount of property, plant, and equipment and the annual depreciation for the project
b. Your calculations that convert the project's EBIT to free cash flow for the 12 years of the project.
c. The following capital budgeting results for the project:
1. Net present value
2. Internal rate of return
3. Discounted payback period.
Do you have a question about it?
