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MAVERICK [17]
3 years ago
5

Julia​ Paul, an analyst at a research​ institute, lives very close to her office and walks to work every day.​ Meanwhile, her​ c

olleague, Amanda​ Jones, dislikes the fact that it takes her almost an hour to commute to work every day. As a​ result, when Julia decides to move to a suburb farther​ away, Amanda is very surprised. Which of the​ following, if​ true, would explain​ Julia's behavior?
A. Amanda earns more than Julia does.
B. ​Julia's office is located in the heart of the city.
C. During​ weekends, Julia teaches painting at an orphanage close to work.
D. Julia saves more in rent than she spends on commuting to work.
E. The city has one of the highest crime rates in the country.
Business
1 answer:
PolarNik [594]3 years ago
8 0

Answer:

D. Julia saves more in rent than she spends on commuting to work

Explanation:

As we are rational agents, we need to optimize our resources in this exercise are money and time, in the statement Julia walks to her job but does not say anything about she dislikes commuting, but Amanda dislikes that, nevertheless when she decide move to the suburb further away must be a logical decision it means that she is going to save more in rent than she spends on commuting, it's a decision that is not influence for the Amanda behaviour and the options B and C don't have sense and there are lack of information to assume that, for this the answer is D it's a stuation when she wins

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Perine, Inc., has balance sheet equity of $5.4 million. At the same time, the income statement shows net income of $783,000. The
S_A_V [24]

Answer:

The target stock price in one year is $149.93

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Also, the income statement shows net income of (NI) = $783,000.

The company paid dividends of (D) = $438,480

Shares of stock outstanding (N) = 100,000

Benchmark PE ratio = 18

Question = what is the target stock price in one year?

We need the expected EPS at the end of next year and not this year.

EPS this year, E₀ = NI / N

                            = 783,000 / 100,000

                            = $ 7.83

Retention Ratio, "R" = 1 - Dividend payout ratio = 1 - D/NI

                                 = 1 - 438,480 / 783,000

                                 = 1 - 56.00%

                                 = 44.00%

Return on equity, ROE = NI / E

                                     = 783,000 / 5,400,000

                                     = 14.50%

Growth rate in earnings, g = R x ROE

                                         = 44.00% x 14.50%

                                         = 6.38%

Hence, expected EPS next year, E₁ = E₀ x (1 + g)

= $ 7.83 x (1 + 6.38%)

= $ 8.33

Hence, target price next year, P = Benchmark PE ratio x E₁

                                                     = 18 x $8.33

                                                     = $149.93

The target stock price in one year = $149.93

4 0
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