A firm's most recent annual dividend was $2 per share; its shares sell for $40 in the stock market, and the company expects its dividend to grow at a constant rate of 5% in the foreseeable future
Using the dividend growth (Gordon) model, what would you estimate its equity cost of capital to be?
10.25% = [(2 )(1.05 )/(40 + .05 )]
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Explain the two approaches to calculating GDP
The investment demand curve will shift to the right as a result of a(n):
a. Decrease in the acquisition and maintenance cost of capital goods b. Increase in the excess productive capacity available in the industry c. Increase in taxes businesses pay to government d. Decrease in the confidence of business leaders about the economy
You pay for cheese and bread from the deli with currency. Which function of money does this best illustrate?
a. medium of exchange b. unit of account c. store of value d. liquidity
A country's level of economic freedom is influenced by
A) freedom to trade internationally. B) the relative size of government expenditures, taxes and enterprises. C) the even-handedness of the court system and security of property rights. D) all of the above.