If one expects the market rate of return to increase across the board on all equity securities, then one should also expect an increase in all stock values.
<h3>Dividend Growth Model</h3>
- Investors can use the dividend growth model, a mathematical technique, to calculate a realistic fair value for a company's stock based on its present payout and anticipated dividend growth in the future.
- The fair value of a company is determined using a valuation method known as the dividend growth model, which makes the assumption that dividend growth will either be constant through time or will vary depending on the current period.
- The dividend growth model has the benefit of offering a straightforward approach to assessing a stock's fundamental worth. Investors are able to contrast the prices of stocks issued by businesses in various industries.
- All stock values should rise if one anticipates an increase in the market rate of return for all equity assets as a whole.
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Answer:
Auditory
Explanation:
According to the Visual-Auditory-Kinesthetic (VAK) learning styles model, a person's dominant learning style is determined by three major sensory receivers i.e visual, auditory and kinesthetic.
Auditory learners learn through listening to spoken words of themselves or of others. Visual learners learn through seeing and reading pictures, illustrations, write-ups etc. Kinesthetic learners learn through touching and feeling things.
Based on the above, the financial planning client's learning style is most likely auditory.
Answer:
9.75%
Explanation:
EPS = Earning per share = $5
DPS = Dividend per share $1.25
ROI = return on investment = 13%, or 0.13
RR = Retention rate = (EPS - DPS)/EPS = ($5 - $1.25)/$5 = 0.75, or 75%
Growth = RR * ROI = 13% * 75% = 9.75%
Therefore, the expected growth rate for KTI's dividend is closest to 9.75%
Answer:
Explanation:
Variable cost = 20,841*70%+9,765*30% = 17,518.20
Fixed cost = 20,841+9,765+2,239 -17,518.20 = 15,326.8
Contribution margin per unit = (Revenue - Variable cost)/subscribers =(35,345-17,518.20)/32.5 = 548.5
a) Break even unit = Fixed cost/Contribution margin = 15,326.8/548.5 = 27.9 Million
b) Revenue per account = (Total variable cost+Total fixed cost)/subscribers = (17,518.20+15,326.8)/32.5 = $1010.61
Answer:
(1) stock dividends
retained earnings will decrease by 2.830.500
total stockholders equity will remain unchanged. the rdecrease in RE is countered with the increase in common stock and additinal paid-in capital
the price will be kept at $51 as the company reocgnize this as the stock value when issuing the shares by using additional paid-in account for the difference between par value and market value
(2) the stock split
It generates no effect on the accounting as just additional shares at issued but the total capitalization and equity values are the same.
The price per share will be half as there is now double amount of shares:
$1 par value
and $25.50 market value
Explanation:
stock dividends
amount of shares issued:
370,000 shares x 15% = 55,500 shares
Retained Earnings decrease: 55,500 x 51 = 2.830.500
55,500 x $ 2 par value = 111,000 common stock
55,500 x $ (51-2) = 499,500 additional paid-in