Business, 18.08.2021 01:30 amandagewecke88

Ecology Labs Inc. will pay a dividend of $4.30 per share in the next 12 months (D1). The required rate of return (Ke) is 18 percent and the constant growth rate is 10 percent. (Each question is independent of the others.) Required:
a. Compute the price of Ecology Labs' common stock.
b. Assume Ke, the required rate of return, goes up to 23 percent. What will be the new price?
c. Assume the growth rate (g) goes up to 13 percent. What will be the new price? Ke goes back to its original value of 18 percent.
d. Assume D1 is $5.10. What will be the new price? Assume Ke is at its original value of 18 percent and g goes back to its original value of 10 percent.

Answers: 1

Show answers

Another question on Business

Business, 21.06.2019 20:00

The maximum tax rate on estates and gifts

Answers: 1

Answer

Business, 21.06.2019 21:30

Unrecorded depreciation on the trucks at the end of the year is $40,000. the total amount of accrued interest expense at year-end is $6,000. the cost of unused office supplies still available at year-end is $2,000. 1. use the above information about the company’s adjustments to complete a 10-column work sheet. 2a. prepare the year-end closing entries for dylan delivery company as of december 31, 2017. 2b. determine the capital amount to be reported on the december 31, 2017 balance sheet.

Answers: 1

Answer

Business, 22.06.2019 19:00

All of the following led to the collapse of the soviet economy except a. a lack of worker incentives. c. inadequate supply of consumer goods. b. a reliance on production quotas. d. the introduction of a market economy.

Answers: 1

Answer

Business, 23.06.2019 00:50

Hubert manages a grocery store in a country experiencing a high rate of inflation. to keep up with inflation, he spends a lot of time every day updating the prices, printing new price tags, and sending out newspaper inserts advertising the new prices. his employees regularly deal with customer annoyance over the frequent price changes. this is an example of the of inflation.

Answers: 2

Answer

You know the right answer?

Ecology Labs Inc. will pay a dividend of $4.30 per share in the next 12 months (D1). The required ra...

Questions