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LUCKY_DIMON [66]
2 years ago
3

Red Sun Rising just paid a dividend of $2.61 per share. The company said that it will increase the dividend by 25 percent and 20

over the next two years, respectively. After that, the company is expected to increase its annual dividend at 3.5 percent. If the required return is 12.1 percent, what is the stock price today?
Business
1 answer:
EleoNora [17]2 years ago
6 0

Answer:

The price of the stock today is $43.90

Explanation:

The three stage gordon growth model will be used to calculate the stock price today as the dividend is increasing by two different rate for the next two years after which it will grow by constant rate for which we will calculate the terminal value at the end of the 2 years.

The formula to calculate the price of such a stock is,

P0 = [2.61 * (1+0.25)] / (1+0.121)  +  [2.61 * (1+0.25) * (1+0.2)] / (1+0.121)²  +        [(2.61 * (1+0.25) * (1+0.2) * (1+0.035)) / (0.121 - 0.035)] / (1+0.121)²

P0 = $43.896 rounded off to $43.90

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An economy produces 1,000,000 computers valued at $2,000 each. Households purchase 200,000 computers, of which 100,000 are impor
Irina18 [472]

Answer:

$800 million

Explanation:

GDP = consumption (C) + investment (I) + government spending (G) + Net Export (NX)

Y = C + I + G + NX

The number of computers left is

= 1,000,000 - 200,000 (household) - 300,000 (businesses) - 300,000 (government) - 100,000 (Foreign)

= 100,000

This worth 100,000 × $2,000 = 200 million

                  300,000 computers × $2,000 = 600 million

Total of these two = 200 + 600 million

                              = 800 million

Therefore, the value of the investment component of GDP is $800 million.

7 0
2 years ago
Bolton Tire Manufacturing and the union came to an impasse during negotiation of the collective bargaining agreement. Specifical
Maslowich

Answer:

The correct answer is the option A: the employees have engaged in an unfair labor practice strike.

Explanation:

To begin with, due to the fact that the union was already establishing the area for the negotiation and they might have planeed obviously to keep trying to increase the situation in their favour then the action taken by the employees was a bit hurry and was obvious that was not thought very well with calm minds and therefore that they engaged in an unfair labor practice strike because they had to be patience and wait for the union to improve the situation for them, because their are the representatives and if the company sees that the workers do not obey to the representatives then the union will lose negotiation power and the situation will get worse for them.

4 0
2 years ago
Whole foods structures its organization in a decentralized manner. what does that mean for the company's operations?
Leokris [45]

Decentralized refers to the process of the activities an organization has within delegation. A centralized organization would have operations coming from a central person or group that has authority over the person or group. A decentralized organization has more independent workers making decisions without being delegated tasks over and over.

4 0
2 years ago
A major liquor store finds that it sells an average of 100 bottles a week of regular 750 ml bottles of Jameson Irish Whiskey. As
Semmy [17]

Answer:

  • 0.04 year
  • 200 bottles
  • 100 bottles
  • 250
  • 200

Explanation:

A)  The current order cycle length = 2 weeks

= 2 / 50 year = 0.04 year

B) The current order size

cycle time ( 2 weeks ) * demand per unit time ( 100 bottles )

= 2 * 100 bottles = 200 bottles

C) average inventory

= order size / 2 weeks = 200 / 2 = 100 bottles

D) calculate how much the liquor store spend per year on ordering

first we calculate the number of orders per year = 50 / 2 = 25

next the amount spent per year on ordering = 25 * 10 = 250

E) calculate  inventory holding costs per year

= average inventory * cost of holding per bottle

= 100 * 2 = 200

7 0
2 years ago
The Charade Corporation is preparing its Manufacturing Overhead budget for the fourth quarter of the year. The budgeted variable
katrin2010 [14]

Answer:

Correct answer is A.

<u>$14.38 per direct labor-hour</u>

Explanation:

If the budgeted direct labor time for December is 8,000 hours, then total budgeted factory overhead per direct labor hour is (rounded):

Total budgeted factory overhead for December= Variable Factory Overhead rate per direct labor hour *  budgeted direct labor time for December + Fixed Factory Overhead per month

Total budgeted factory overhead for December = 5*8000 + 75000

Total budgeted factory overhead for December = $ 115,000

Total budgeted factory overhead per direct labor hour = Total budgeted factory overhead for December/budgeted direct labor time for December

Total budgeted factory overhead per direct labor hour = 115000/8000

Total budgeted factory overhead per direct labor hour = 14.38

5 0
2 years ago
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