Schiller corporation will pay a $2.78 per share dividend next year. the company pledges to increase its dividend by 4.5 percent per year, indefinitely. if you require a return of 15 percent on your investment, how much will you pay for the company’s stock today?

How is a proportional tax different from a progressive tax? a. a proportional tax decreases with income level, but a progressive tax increases with income level. b. a proportional tax increases with income level, but a progressive tax decreases with income level. c. a proportional tax increases with income level, but a progressive tax is the same percentage for all. d. a proportional tax is the same percentage for all, but a progressive tax increases with income level.

Amachine purchased three years ago for $720,000 has a current book value using straight-line depreciation of $400,000: its operating expenses are $60,000 per year. a replacement machine would cost $480,000, have a useful life of nine years, and would require $26,000 per year in operating expenses. it has an expected salvage value of $130,000 after nine years. the current disposal value of the old machine is $170,000: if it is kept 9 more years, its residual value would be $20,000. calculate the total costs in keeping the old machine and purchase a new machine. should the old machine be replaced?

Gulliver travel agencies thinks interest rates in europe are low. the firm borrows euros at 5 percent for one year. during this time period the dollar falls 11 percent against the euro. what is the effective interest rate on the loan for one year? (consider the 11 percent fall in the value of the dollar as well as the interest payment.)