The government of Paulaville decides to set prices of wheat. Calculate the amount of the shortage or surplus if the government sets a price floor at $2.

Answers

Answer 1

Answer:

I have uploaded the picture with the relevant information below.

Explanation:

We can see in this picture that the market equilibrium is met at a price of $5, thus, $5 is the equilibrium price, because demand and supply are both 125 at this point.

If the govenment sets a price floor of $2, there will be no effect, because the price floor is non-binding.

A non-binding price floor is a minimum price set by the government that is actually lower that the equilibrium market price. In this case, the price of the market will be allowed to go to $5, and reach equilibrium, so the policy osf setting the $2 price floor will have no effect.

The Government Of Paulaville Decides To Set Prices Of Wheat. Calculate The Amount Of The Shortage Or

Related Questions

How is a loan obtained through a pawnshop typically paid off?

Answers

Answer:

B. In a single payment, and the collateral is returned

Multiple-choices

A. In multiple payments, and collateral is retuned

B. In a single payment, and the collateral is returned.

C. The lender sells the item to pay off the interest.

D. The lender cashes a postdated check.

Explanation:

A pawn-loan is a credit facility based on collateral provided. Pawnshop issues pawn-loans without any credit history checking. The borrower presents an item of value, either jewelry, electronics, mobile gadgets, or other items resellable to other customers.

A pawnshop typically issues short term loans. The credit period is mostly 30 days. The borrower is should to repay the loan amount plus interest by end of month to redeem their collateral.  Due to the short credit period and the high risk of lending, pawnshops do not usually allow installment repayments.

why is the period from late 20s to early 40s the best time for becoming an entreprnur?​

Answers

Late 20s to late 40s: This is almost the perfect time for would-be entrepreneurs, for many reasons: At this point in life, they know what they like, and what they don't like. They have obtained business and life skills. They have some assets and credit.

The period from late 20s to early 40s the best time for becoming an entrepreneur is the creative and innovative ideas are the used is the startup new business.

What is entrepreneur?

The term “entrepreneur” refers to the person who launches a new business at their own risk and profit basis. The starting up of a new business with a new idea and logic is called entrepreneurship. The entrepreneur's main motive is to set up a business to generate employment.

The period from the early 20s to the early 40s is ideal for an entrepreneur since technology is evolved enough to start a new business. The business owner works on websites, blogs, digital media, photo editing, television, and radio. The inventive and creative ideas that comprise the most effective company plans.

As a result, the  20s to early 40s are the best period to entrepreneur.

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JRJ Corporation recently issued 10-year bonds at a price of $1,000. These bonds pay $60 in interest each six months. Their price has remained stable since they were issued, that is, they still sell for $1,000. Due to additional financing needs, the firm wishes to issue new bonds that would have a maturity of 10 years, a par value of $1,000, and pay $40 in interest every six months. If both bonds have the same Yield to Maturity, how many new bonds must JRJ issue to raise $2,000,000?(Hint find the YTM of first bond the find the value of 2nd bond)

Answers

Answer: 2596 bonds

Explanation:

The following information can be gotten from the question:

Coupon rate = 8.0%

Face value = 1000

Year to maturity = 10

NPER = 20

PMT = Face value × Coupon rate / 2 =(1000 × 0.08) / 2 = 80/2 = 40

Yield = 12%

Rate = Yield / 2 = 12% / 2 = 6%

We then calculate the net proceeds which will be:

= PV(rate, NPER, PMT, FV)

= PV(6%, 20, 40, 1000)

= $770.60

We should note that the amount that needed to be raised is $2,000,000. Therefore, the bond that will be needed to be sold will be:

= $2,000,000 / 770.60

= 2596 bonds

Coronado Industries is purchasing new equipment with a cash cost of $189200 for the assembly line. The manufacturer has offered to accept $46000 payments at the end of each of the next six years. What is the interest rate that Coronado Industries will be paying? a) 10%. b) 12%. c) 11%. d) 13%.

Answers

Answer:

The correct option is b) 12%

Explanation:

Note: See the attached excel for the interest calculation.

In the question, we are given the following:

Equipment cash cost = $189,200

Yearly payment = $46,000

Number of years = 6

The above are used in the attached excel file to calculate the interest rate.

The interest rate is calculated using the following simple excel rate function in the attache excel file:

=RATE(npr,pmt,-pv)

Where;

pv = Present value = Equipment cash cost = $189,200

pmt = Yearly payment = $46,000

npr = Number of years = 6

Using the function in the attached excel file, we obtained 12%. Therefore, the correct option is b) 12%.

Betz Company's sales budget shows the following projections for next year:
Sales in Units: 1st Quarter = 60,000; 2nd Quarter = 80,000; 3rd Quarter = 45,000; 4th Quarter = 55,000
Inventory at the beginning of the year was 18,000 units. The finished goods inventory at the end of each quarter is to equal 30% of the next quarter's budgeted unit sales. How many units should be produced during the first quarter?
a) 24,000
b) 48,000
c) 66,000
d) 72,000

Answers

Answer:

c) 66,000

Explanation:

Calculation for How many units should be produced during the first quarte

Using this formula

Amount of Units produced = Ending inventory + Units sold + Beginning inventory

Let plug in the formula

Amount of Units produced= (30% × 80,000) + 60,000 − 18,000

Amount of Units produced= 24,000 + 60,000 − 18,000

Amount of Units produced=$66,000

Therefore the units that should be produced during the first quarter will be $66,000

Giving customers time to pay their bill generates more sales. But when a recession hits, they may have trouble making payments. If you have businesses as clients, they may have slow-paying customers, and that means they will be slow to pay you. That is what happened to a company that offered a discount card as its primary product. The owner estimated that 50 percent of the firm's customers—other small businesses—were behind in paying what they owed. The owner needed those customers to keep his business operating, so he was hesitant to demand payment on past due accounts.
1. Should a small business owner push customers to pay when times are tough? Why or why not?
2. What problems do you think a business services company might have when is customers do not pay?

Answers

Answer:

1. A compromise should be reached.

In the recession, the other small businesses are suffering including the company in question. If the owner pushes the customers to pay their bills, when the recession ends they may move to other vendors which would have made demanding money from them in the recession a myopic and damaging move.

The business however, also has bills to pay and so needs money to maintain operations as well. A compromise needs to be reached. The owner should contact the other businesses still owing and negotiate with them to pay a certain portion of what they owe with the rest coming later.

This could give the owner enough to keep the business running whilst maintaining the loyalty of his customers.

2. Problems that a business services company could have if customers do not pay include;

Inability to pay staff. Inability to pay utilities like electricity.Inability to pay rent and other expenses.Increased risk of debt default.Growth of company suffers.

What is international market segmentation? What challenges does it pose to Bentley?

Answers

Answer:

Bentley has differentiated and positioned its brand effectively. ... In traditional market there is a growth in high network people by 16.6%, Bentley will continue to grow because the potential customers grew.

Explanation:

Effective product positioning and differentiation are hallmarks of Bentley. Due to the increased number of prospective clients, Bentley will keep expanding.

What is the international market?

An international market is one that is located entirely inside a firm's home country, whereas a global market is any specific location that is not within the borders of that nation.

Finding nations and/or customers that have important characteristics, such as desires and needs connected to a product, and who would be responsive to an item and ’s promotional mix.

Bentley sells premium cars and caters to high-income demographics in order to grow its brand. It is not afraid to demand a price that is normally expensive since it makes items of the highest caliber that are supplied only via private dealers.

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A loss on the constructive retirement of a parent's bonds by a subsidiary is effectively recognized in the individual accounting records of the parent and its subsidiary:_________

I.at the date of constructive retirement
II.over the remaining term of the bonds.

a. I
b. II
c. Both I and II
d. Neither I nor II

Answers

Answer:

c. Both I and II

Explanation:

In the case when there is a loss at the time of the retirement of the parent bond by a subsidiary and it could be effectively recorded in the accounting records of the parent and the subsidiary. It could be done at that date when the retirement is done in a constructive way also the bond terms that are left

Therefore both options should be recognized

Hence, the correct option is c.

What's a benefit of creating playlists?

Answers

Answer:

By organizing similar content together, it increases the likelihood that viewers will watch multiple videos in one sitting. Another benefit of playlists is that they provide additional opportunities to appear in You Tube search results.

On January 1, 2016, Horton Inc. sells a machine for $25,800. The machine was originally purchased on January 1, 2014 for $46,700. The machine was estimated to have a useful life of 5 years and a residual value of $0. Horton uses straight-line depreciation. In recording this transaction: a. a loss of $2,220 would be recorded. b. a loss of $20,900 would be recorded. c. a gain of $25,800 would be recorded. d. a gain of $2,20 would be recorded.

Answers

Answer:

a) a loss of $2220 would be recorded.

Explanation:

Calculation for the Loss on sale

First step is to calculate the Depreciation per annum using this formula

Depreciation per annum = (Purchase Cost-salvage value) / Useful life

Depreciation per annum = 46700/5

Depreciation per annum= $9,340

Second Step will be to calculate the 31/12/15 Book Value

1/1/14 Purchase cost $46,700

Less: 31/12/14 Depreciation for the year ended 31 ($9,340)

31/12/14 Book Value $37,360

($46,700-$9,340)

Less: 31/12/15 Depreciation for the year ended ($9,340)

31/12/15 Book Value $28,020

($37,360-$9,340)

Last step is to calculate the Loss on sale

1/1/16 Value $28,020

1/1/16 Less Sale value ($25,800)

Loss on sale $2220

(28,020-25,800)

Therefore the correct option is :a loss of $2220 would be recorded.


A sentence that contains one independent clause and one or more dependent clauses is a

Answers

Answer:

Complex sentence they always have one independent clause + 1 or more dependant clause

Joined by using conjunctions!

A share of common just paid a dividend of $1.00. If the expected long-run growth rate for this stock is 5.4%, and if investors' required rate of return is 13.9%, what is the stock price?
a) $11.04
b) $12.40
c) $13.76
d) $15.00
e) $9.42

Answers

Answer:

The correct option is b) $12.40.

Explanation:

The stock price can be calculated using the Gordon growth model (GGM) formula that assumes that dividend growth rate will be stable in the long run. The formula is given as follows:

P = d / (r - g) ……………………………………… (1)

Where;

P = Stock price = ?

d = next year dividend = Dividend just paid * (1 + Dividend growth rate) = $1.00 * (1 + 0.054) = $1.00 * 1.054 = $1.054

r = required rate of return = 13.9% = 0.139

g = dividend constant growth forever = 5.4%, or 0.054

Substituting the values into equation (1), we have:

P = $1.054 / (0.139 - 0.054)

P = $1.054 / 0.085

P = $12.40

Therefore, the stock price $12.40. That is, the correct option is b) $12.40.

Allocative efficiency is achieved when:____.a. there are no shortages or surpluses in the market. b. goods and services are fairly distributed among consumers in an economy. c. firms produce goods and services at the lowest cost. d. firms produce the goods and services that consumers value most.

Answers

Answer:

The correct answer is the option A: there are no shortages or surpluses in the market.

Explanation:

To begin with, the concept known as "Allocative Efficiency" in the microeconomics theory refers to the state where all the goods and services that are offered by the suppliers are all consumed by the buyers at the market and therefore that there are no shortages or surpluses in there. Moreover, this theory represents the situation where the last unit produced by the suppliers provides a marginal benefit to the consumers that equals to the marginal cost of producing that last unit. So that is why that is achieved when the market is empty.

A project has the following projected outcomes in dollars:______. $210, $340, and $520. The probabilities of their outcomes are 20%, 50%, and 30% respectively. What is the expected value of these outcomes?

Answers

Answer:

Expected value of these outcomes is $368

Explanation:

Expected value is the weighted average value of random variable. It is the sum of all the probable outcome.

Expected value can be calculated as follow

Outcomes ________ Probabilities _________ Expected values

$210 _______________ 20% ________________ $42

$340 _______________ 50% ________________ $170

$520 _______________ 30% ________________ $156

Total ____________________________________ $368

You invest 50% of your money in security A with a beta of 1.6 and the rest of your money in security B with a beta of 0.7. The beta of the resulting portfolio is:_____

a. 1.08
b. 0.8
c. 1.40
d. 1.15
e. 0.36

Answers

Answer:

The answer is D). 1.15, hope this helps, have a great day/night, stay safe, happy thanksgiving!

when your mom is spanking you what should you do? A.put her in a lock B.call her parents C.tell jamall to calm down D.take the hits

Answers

Answer: Take the hits bro. Then call her parents

Explanation: Memes that slap harder than my dads belt!!!! Lol

The basic promotion objectives and adoption process fit very neatly with an action-oriented model, which is called the
A) bricks and clicks model.
B) bait and hook model.
C) AIDA model.
D) DAGMAR model.
E) economic buyer model.

Answers

Answer:

C) AIDA model.

Explanation:

AIDA model which the complete words are

✓attention( seek the attention of potential buyer)

✓interest(know their interest)

✓desire

✓action.

Can be regarded as a model that has been in existence since 19th century, which is engaged in marketing to analyze the process the steps/process that consumer follow when making a purchase on a particular goods/product. It should be noted that the The basic promotion objectives and adoption process fit very neatly with an action-oriented model, is called the AIDA model.

BPS reported the following data for its first year of operations: Sales Revenue $8,000 Cost of Goods Available for Sale 6,200 Operating Expenses 900 Sales Returns & Allowances 640 Sales Discounts Ending Merchandise Inventory: If LIFO is used 820 If FIFO is used 128 925 What is the company's net income if LIFO is elected? A. None of the other 4 answer choices provided are correct. B. $132 C. $1,057 D. $952 E. $1,720

Answers

Answer:

D. $952

Explanation:

The computation of the net income in the case when the LIFO is elected

Particulars AMount

Net sales    $7,232   ($8,000 - $640 - $128)

less : cost of goods sold ($6,200 - $820) $5,380

Gross Profit $1,852

Less: Operating Expenses   $900

Income before taxes $952

less: Income tax $0

Net income $952

Hence, the net income is $952

You have been texting with your friends trying to make plans for this evening. Your best friend Jocelyn is not sure if she will finish her homework in time to come out, but if she does, she wants to go to a new restaurant on the north end of town that you've both been wanting to try. Another group of friends is going to a restaurant on the south end of town, but you've already been to this restaurant and it was only okay. Overall, you would prefer to go to the restaurant with Jocelyn. But if Jocelyn isn't coming out, you would rather hang out with your friends than stay home. No one is returning your calls, but you need to get on the subway and head into town if you want to do anything this evening. You have to decide whether to head north or south. What can we say about a potential dominant strategy in this game?

Answers

Answer:

go north.

Explanation:

The potential dominant strategy in this game is to go north. This can be stated through the concept of dominant strategy, which means that the chosen strategy will be the most appropriate according to someone's perspective, that is, the strategy that will be most beneficial and useful.

In the case of the scenario above, it is possible to affirm that the dominant strategy is to go north because the statement provides information that the general, you prefer to go to the northern restaurant with Jocelyn, so this is configured as the correct option, regardless if the Jocelyn may or may not go, because in a dominant strategy what matters is to choose the most useful option for you, regardless of the actions of third parties.

In 2010, real GDP was $13.2 trillion and nominal GDP was $14.6 trillion. What was the GDP deflator for that year?a. 9.6% lower b. 9.6% higher c. 10.6% lower . d. 10.6% higher

Answers

Answer:

d. 10.6% higher

Explanation:

Given that;

Real GDP = $13.2 trillion

Nominal GDP = $14.6 trillion

GDP deflator = (Nominal GDP/Real GDP)× 100)

Hence,

GDP deflator = (14.6 / 13.2 ) × 100

GDP deflator = 110.6%

Thus,

= 110.6 - 100

= 10.6% higher

Discuss a prominent environmental or sustainability practice employed by a company that you believe has been forward thinking and successful in their efforts. How have their policies impacted the company, society, and the environment?

Answers

Explanation:

Sustainability is an increasingly recurrent issue on the world stage, which directly affects companies and the way their resources are used. Society increasingly demands that companies be environmentally responsible, as a way of protecting today's society and future generations, since natural resources are scarce and we depend on them for quality of life.

One company we can cite as an example is GOOGLE, a world-renowned company that promotes its environmental responsibility through its communication channels and adopts sustainable practices like the one announced in 2019, which until 2020 the company will not emit carbon in its products and in 2022 all hardware products used in the company will be made of recyclable materials.

Environmental policies have a positive impact on society as a whole, bringing the issue to the fore and making more and more people responsible for exercising sustainability. For the company, we can highlight the reduction of waste in the production process, adding continuous organizational improvement and better positioning of the company. in the market and for stakeholders.

Beige Corporation, a C corporation, purchases a warehouse on August 1, 2007, for $1 million. Straight-line depreciation is taken in the amount of $411,750 before the property is sold on June 11, of the current year, for $1.2 million. What is the amount and character of the gain recognized by Beige on the sale of the realty?

Answers

Answer and Explanation:

The computation of the amount and character of the gain recorded is shown below:

1. Recognized gain would be

= Sales - the cost of the property - recovery cost

= $1,200,000 - $1,000,000 - $411,750

= $611,750

2. Now as per the section 1245 the potential recapture is $411,750

3. Now extra section 291 ordinary income in the case when it is a corporation

= $411,750 ×20%

= $82,350

4. And finally $82,350 would be considered as an ordinary income under section 291 while the remaining balance i.e.

= $611,750 - $82,350

= $529,400

This amount would be considered as a gain under section 1231

Sick time and vacation time are considered a benefit because even
though you are not at work you still get paid.

True

False​

Answers

Answer:

TRUEE

i just know

Explanation:

Hope this helps!

if so please dont forget to mark BRAINLIST!!

thx

After graduating law school Amy has to start repaying her $110,000 in loans. Assuming the annual interest rate is 7.5% over a 20 year repayment period, what will be the monthly loan payments?

a. $886.15
b. $458.34
c. $899.18
d. $906.93

Answers

Answer:

monthly payment= $886.15

Explanation:

Giving the following information:

PV= $110,000

i= 0.075/12= 0.00625

n= 12*20= 240

To calculate the monthly payment, we need to use the following formula:

monthly payment= (PV*i) / [1 - (1+i)^(-n)]

monthly payment= (110,000*0.00625) / [1 - (1.00625^-240)]

monthly payment= $886.15

Do you agree or disagree with the following statements

a. The demand curve facing a monopolistic competitor in a market where all producers charge different prices becomes less elastic when it engages in international trade
b. According to the gravity equation, countries closer to each other trade more
c. The only gain from trade in monopolistic competition in trade is lower prices
d. The closer to 1 the index of intra industry trade is, the greater the difference between exports and imports of the same goods.

Answers

Answer:

a. The demand curve facing a monopolistic competitor in a market where all producers charge different prices becomes less elastic when it engages in international trade - Disagree

This statement is not true. If a monopolistic competitor engages in international trade, it will meet more competition, meaning that the audience (demand) that it has is more sensitive to prices, because they have more options available.

b. According to the gravity equation, countries closer to each other trade more - Agree

The gravity equation tells us that the volume of international trade is correlated with geographical proximity and economic size. That is to say, the closer and larger two economies are, the more international trade they engage with each other.

c. The only gain from trade in monopolistic competition in trade is lower prices - Disagree

Gains are the most important in lower prices, but there are also gains in competitiveness and quality.

d. The closer to 1 the index of intra industry trade is, the greater the difference between exports and imports of the same goods. - Disagree

An index of intra industry trade of 1 indicates that the country imports and exports roughly the same amount for a particular type of goods (the goods that belong to that industry). Hence, the statement is not true.

Changing views on older employees in the workforce can be summed up by saying that companies used to A) offer pay raises as employees rose through the ranks, but are starting to decrease pay for elderly workers due to changes in Social Security benefits. B) regard older workers as a positive influence in the workforce, but with the aging of baby boomers, this perspective is undergoing a shift. C) encourage retirement to save money, but now are eager to benefit from older workers' knowledge, experience, and positive work ethic D) continue training workers up until the point of retirement, but today they recognize that this is a poor use of resources. E) value the knowledge, experience, and positive work ethic of older employces, but now are encouraging retirement in order to save money

Answers

Answer:

The changing views on older employees in the workforce can be summed up by saying that companies used to:

C) encourage retirement to save money, but now are eager to benefit from older workers' knowledge, experience, and positive work ethic.

Explanation:

Older employees have got the wisdom and experience to function effectively in their roles.  This is why employers are now trying to derive the best value from older workers.  The knowledge and wisdom that employers access from their older workers can be used to encourage the younger workers to attain stellar performance.  They also use the older workers to showcase the exemplary conducts which are expected from the younger workers.

Is it possible for unemployment rates to increase at the same time that the number of employed persons is increasing

Answers

Answer:

Yes, it is possible for unemployment rates to increase at the same time that the number of employed persons is increasing

Explanation:

Yes, if the number of people who are employed increases, the unemployment rate in an economy also increases. Because, if the labor force increases, the people will try to get the new job and it leads to the increases in the job growth. Thus, an increase in the employment rate will increase the unemployment rate in an economy.

1) Suppose that GDP is $10,000, Consumption is $6,000, and Government spending is $1,500 with a deficit of $200. (Assume net exports are zero) What is the level of private saving in this economy?a) 1,500.b) 2,500.c) 7,200.d) 2,700.2) The population of Scottsdale is 100 people. 40 people work full time, 20 work half time but prefer to work full time, 10 are seeking work, 10 would like to work but are discouraged from seeking, 10 are full time students without a desire to work while in school, and 10 are retired. What is the unemployment rate?a) 10%b) 20%.c) 40%.d) 30%.3) Lately, talks about creating more barriers to trade has contributed to some volatility in the stock market. In this case, short downturns in the market would reflect the fact that firms are unsure about how to make investment plans. This uncertainty in the investment market would tend to _______ investment and _______ interest rates.a) raise, lower.b) raise, raise.c) lower, raise.d) lower, lower.4) In the Hans Rosling video discussing the magic washing machine, which of the following points is made?A) About half of the worldâs energy use is used by the least developed countries.B) Poor, less developed countries cannot mobilize to improve their standard of living.C) The washing machine, while valuable, cannot and should not be used by everyone due to energy crisis.D) One valuable aspect of the washing machine is the time it frees up to engage in other activities, such as learning, which ultimately promotes economic growth.

Answers

Answer:

1) Suppose that GDP is $10,000, Consumption is $6,000, and Government spending is $1,500 with a deficit of $200. (Assume net exports are zero) What is the level of private saving in this economy?

d) 2,700

GDP = C + (G - deficit) + I + NX

GDP = $10,000

C = $6,000

G - deficit = $1,300

NX = $0

$10,000 = $6,000 + $1,300 + I

I = $2,700

2) The population of Scottsdale is 100 people. 40 people work full time, 20 work half time but prefer to work full time, 10 are seeking work, 10 would like to work but are discouraged from seeking, 10 are full time students without a desire to work while in school, and 10 are retired. What is the unemployment rate?

14.29%

total work force = 40 (working full time) + 20 (working part time) + 10 (not working but seeking a job) = 70 people

Students are not part of the labor force, retired people are not part of it either and those without a job but not actively looking for one are not part of the labor force either.

unemployed = 10

unemployment rate = unemployed / total labor force = 10 / 70 = 14.29%

3) Lately, talks about creating more barriers to trade has contributed to some volatility in the stock market. In this case, short downturns in the market would reflect the fact that firms are unsure about how to make investment plans. This uncertainty in the investment market would tend to _______ investment and _______ interest rates.

c) lower, raise.

Investors are risk averse, that means that the higher the risk, the higher the expected returns form an investment. Uncertainty increases risk, which decreases total investment and increases interest rates (price of money).

4) In the Hans Rosling video discussing the magic washing machine, which of the following points is made?

D) One valuable aspect of the washing machine is the time it frees up to engage in other activities, such as learning, which ultimately promotes economic growth.

The consumption of energy is divided almost equally between rich people and poor people, the problem is that poor people represent more than 86% of the world's population. You must also remember that not all the people living in developed countries are rich, e.g. in the US, 11% of the population is poor. The % of poor people increase as you go from developed to developing countries.

If you combine total energy consumption of developing countries, it only represents 30% of the world's energy consumption.

Zhang Company reported Cost of goods sold of $835,000, beginning Inventory of $37,200 and ending Inventory of $46,300. The average Inventory amount is:______.a) $37,200b) $46,300c) $83,500d) $41,750

Answers

Answer:

Average inventory= $41,750

Explanation:

Giving the following information:

Beginning Inventory= $37,200

Ending Inventory= $46,300

To calculate the average inventory, we need to use the following formula:

Average inventory= (beginning inventory + ending inventory) / 2

Average inventory= (37,200 + 46,300) / 2

Average inventory= $41,750

Bikes and More just announced its next annual dividend will be $2.42 a share and all future dividends will increase by 2.5 percent annually. What is the market rate of return if this stock is currently selling for $22 a share?

Answers

Answer:

13.5%

Explanation:

market rate of return can be calculated with below expresion

Current Price = D / (K - g)

Where

Current Price = $22 a share

D= Dividend in coming Year

dividend = $2.42

K= rate of return

g =growth rate

22 = 2.42 / (K - 0.025)

Cross multiply we have

22(K - 0.025)= 2.42

Open the bracket we have

22k- 0.55=2.42

2.42 + 0.55= 22k

K = 2.97 / 22

= 0.135

= 0.135×100%

= 13.5%

Therefore, the market rate of return if this stock is currently selling for $22 a share is 13.5

Other Questions
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