Angel recently purchased a block of 100 shares of Hayley's Optical common stock for $6,000. She expects to receive annual dividends of $400 indefinitely from those shares. Assuming a discount rate of 8 percent, how does the price Angel paid compare to the value of the stock?
What will be an ideal response?
The value of the stock is = $400/0.08 = $5,000
You might also like to view...
Picozzi Snow Removal's cost formula for its vehicle operating cost is $2,060 per month plus $306 per snow-day. For the month of January, the company planned for activity of 16 snow-days, but the actual level of activity was 18 snow-days. The actual vehicle operating cost for the month was $7,720. The vehicle operating cost in the planning budget for January would be closest to:
A. $6,862 B. $7,568 C. $7,720 D. $6,956
An executory promise is the giving of value to support holder in due course status
Indicate whether the statement is true or false
In Japanese, the word _____ means both "customer" and "honorable guest."
a. seiketsu b. shitsuke c. kaizen d. okyakusama
Destructive conflict can lead to win-lose or lose-lose outcomes, in which one or both sides lose, to the detriment of the entire team
Indicate whether the statement is true or false.