Michael's, Inc., just paid $2.25 to its shareholders as the annual dividend. Simultaneously, the company announced that future dividends will be increasing by 4.9 percent. If you require a rate of return of 9.1 percent, how much are you willing to pay today to purchase one share of the company's stock?

$56.20

Explanation:

We know,

Under constant growth model, value of stock, =

Here,

= Expected dividend/Next year dividend = × (1 + g)

= Current year dividend = $2.25

g = dividend growth rate = 4.9% = 0.049

r = required rate of return = 9.1% = 0.091

Therefore,

= Expected dividend/Next year dividend = $2.25 × (1 + 0.049) = $2.25 × 1.049 = 2.36025

Putting the values into the above formula, we can get,

=

or, = 2.36025 ÷ 0.042

Therefore, I am willing to pay today to purchase one share of the company's stock, = $56.20

answer: marginal utility of the fourth brownie is 0.

explanation: marginal utility is the addtional utility gained from the consumption of one more unit of a good. it is given by,

so, marginal utility at the 4th unit will be given by

since, the values are not given here, you can simply find marginal utility at fourth unit by subtracting total utility at 3rd unit from total utility at 4th unit.