Which of the following is the most likely explanation for inflation in the United States?

TP Inc. is a young start-up company. No dividends will be paid on the stock over the next 9 years, because the firm needs to plo

tatiyna

Answer:

$41.69.

Explanation:

P9 = Next dividend / Required rate - Growth rate

P9 = $5 / 8% - 2%

P9 = $5 / 6%

P9 = $5 / 0.06

P9 = $83.33

So, the stock price for 9th year is $83.33

Current stock price = P9 / (1 + Required rate of return)

Current stock price = $83.33 / (1+0.08)^9

Current stock price = $83.33 / (1.08)^9

Current stock price = $83.33 / 1.9990046271

Current stock price = 41.68574643115692

Current stock price = $41.69

Therefore, the current stock price is $41.69.

8 0

3 years ago

g A decrease in aggregate demand will cause prices to fall according to classical economists, and unemployment to increase accor

Mashcka [7]

Answer:

prices to fall according to the classical economists and unemployment to increase according to Keynes.

Explanation:

The classical economists believes that a decrease in aggregate demand for goods produced would being about fall in the prices of such goods. What this implies is that as more goods are produced, if such production is not backed by corresponding demand by consumers, the prices of such goods produced will eventually fall because supply is greater than demand.

For the Keynes, their argument is that a decrease in aggregate demand will cause unemployment to increase. This is because owners of businesses or employers would lay off their employees when goods produced exceeds the demand for such production by consumers. Here, owners of businesses pays their employees through sales of goods produced. So, when the goods produced are not purchased, then there will be excess availability of such goods; hence no sale or profit, from which salaries would be paid. The next step is to start laying off employees because employers cannot cover their running costs.

7 0

3 years ago

The government might enact a price ceiling in order to accomplish what

uysha [10]

A limit of spending of the government,

5 0

3 years ago

Read 2 more answers

Suppose Megan is considering emigrating from her home country.

Evgen [1.6K]

Answer:

a. emigrate

b. more

Explanation:

Immigration attractiveness is a factor that draws immigrants to a foreign country. A country becomes more attractive when the economic prospects are brighter than at the home-country. The degree of immigration law enforcement also helps to either attract or deter potential migrants. In recent years, wars and misgovernment have propelled millions to move boundaries. At the same time, countries are imposing migration restrictions by imposing and implementing strict laws.

5 0

3 years ago

Feldspar Inc. is considering the capital structure for a new division. Management has been given the following cost information:

34kurt

Answer:

Option 4

Explanation:

In this question ,we have to compute the WACC which is shown below:

= Weightage of debt × cost of debt × ( 1- tax rate) + (Weightage of common stock) × (cost of common stock)

For Option 1, it would be

= (0.3 × 10%) × ( 1 - 40%) + (0.7 × 12.5%)

= 1.8% + 8.75%

= 10.55%

For Option 2, it would be

= (0.4 × 10.5%) × ( 1 - 40%) + (0.6 × 13%)

= 2.52% + 7.8%

= 10.32%

For Option 3, it would be

= (0.5 × 11%) × ( 1 - 40%) + (0.5 × 13.5%)

= 3.3% + 6.75%

= 10.05%

For Option 4, it would be

= (0.6 × 11.7%) × ( 1 - 40%) + (0.4 × 14.2%)

= 4.212% + 5.68%

= 9.89%

For Option 5, it would be

= (0.7 × 13%) × ( 1 - 40%) + (0.3 × 15.5%)

= 5.46% + 4.65%

= 10.11%

So based on this, the management should accept option 4 as it derives the best debt asset ratio

The weightage of equity would be come

= 1 - weightage of debt

8 0

3 years ago

Which of the following is the most likely explanation for inflation in the United​ States?

Which of the following is the most likely explanation for inflation in the United States?