Share
Explore BrainMass

Business Math

Constant Growth Stock Valuation

Suppose a firm's common stock paid a dividend of $2.50 yesterday. You expect the dividend to grow at the rate of 5% per year for the next 3 years, if you buy the stock, you plan to hold it for 3 years and then sell it. a.Find the expected dividend for each of the next 3 years; in other words, calculate D1 , D2 and D3 . Note

Return on Common Stock

You buy a share of The Ludwig Corporation stock for $23.90. You expect it to pay dividends of $1.08, $1.13, and $1.1823 in Years 1, 2, and 3, respectively, and you expect to sell it at a price of $29.89 at the end of 3 years. a.Calculate the growth rate in dividends. Round your answer to two decimal places. ? % b.Cal

Preferred Stock Valuation and Nick Enchiladas

Nick's Enchiladas Incorporated has preferred stock outstanding that pays a dividend of $3 at the end of each year. The preferred stock sells for $55 a share. What is the stock's required rate of return?

Constant Growth Valuation: Example

Boehm Incorporated is expected to pay a $1.70 per share dividend at the end of this year (i.e., D1 = $1.70). The dividend is expected to grow at a constant rate of 4% a year. The required rate of return on the stock, rs, is 13%. What is the value per share of the company's stock?

A DPS calculation

Thress Industries just paid a dividend of $2.75 a share.The dividend is expected to grow 5% a year for the next 3 years and then at 11% a year thereafter. What is the expected dividend per share for each of the next 5 years?

Probability low to charge that instead of using random selection

A certain company reduced its management staff from 20 managers to 16. The company claimed that four managers were randomly selected for job termination. However, the four managers chosen are the four oldest managers among the 20 that were employed. Answer the questions below. a. Find the probability that when four managers

beta

Suppose you hold a diversified portfolio consisting of a $7,500 investment in each of 20 different common stocks. The portfolio's beta is 0.85. Now, suppose you sell one of the stocks with a beta of 1.0 for $7,500 and use the proceeds to buy another stock whose beta is 0.95. Calculate your portfolio's new beta.

How to calculate a portfolio's beta

An individual has $50,000 invested in a stock with a beta of 0.8 and another $45,000 invested in a stock with a beta of 1.9. If these are the only two investments in her portfolio, what is her portfolio's beta? Round your answer to two decimal places.

Math 201: Computation of Correlation Coefficient

The data below are the final exam scores of 10 randomly selected statistics students and the number of hours they studied for the exam. Find the correlation coefficient between hours studied and final exam scores. Is there a weak or strong, positive or negative correlation between hours studied and final exam scores? Hours x

Math 201

A manager wishes to determine the relationship between the number of miles (in hundreds of miles) the manager's sales representatives travel per month and the amount of sales (in thousands of dollars) per month. Find the equation of the regression line for the given data. Predict the value of sales when the sales representative

Calculating weighted average cost of capital of Shi Importer

Shi Importer's balance sheet shows $300 million in debt, $50 million in preferred stock, and $250 million in total common equity. Shi's tax rate is 40%, rd = 6%, rps = 5.8%, and rs = 12%. If Shi has a target capital structure of 30% debt, 5% preferred stock, and 65% common stock, what is its WACC?

Estimating common equity from retained earnings

Your firm has been hired to help ABC Company to estimate the cost of common equity. The yield on the firm's bonds is 5.75%, and your firm's economists believe that the cost of common equity can be estimated using a risk premium of 2.5% over a firm's own cost of debt. What is an estimate of the firm's cost of common equity from

Generally Accepted Accounting Principles

Discuss the terms listed below. Explain why these concepts are important to financial statements. Generally Accepted Accounting Principles (US GAAP); International Accounting Standards (IFRS); and Liquidity.

Sale of partnership interest

Sue and Linda are equal partners in a partnership. Both partners had a basis of $160,000 on the date Sue decides to sell 1/2 of her share. On that date, Sue sells 1/2 of her interest to Alice for $60,000 cash. Partnership assets on the sale date were: Basis FMV Inc(dec

Rationale and Probability distribution

1.Describe the rationale for utilizing probability concepts. Is there more than one type of probability? If so, describe the different types of probability. 2.Briefly discuss probability distributions. What is a normal distribution? Please provide a written example of how 'understanding distribution' can be an asset for

Rentro Rentals Bond Maturation Example Question

Rentro Rentals has issued bonds that have a 10% coupon rate, payable semiannually. The bonds mature in 8 years, have a face value of $1,000, and a yield to maturity of 8.5%. What is the price of the bonds?

Water's Current E&P for the Year

Water Corporation reports $500,000 of taxable income for the current year. The following additional information is available: ? For the current year, Water reports an $80,000 long-term capital loss and no capital gains. ? Taxable income includes $80,000 of dividends from a 10%-owned domestic corporation. ? Water paid fines

Equity Section Journal Entries

Problem 1: The HNR Company's common stock information includes: Current market price per share: $154 Current book value per share: $117 Current par value per share: $40 Shares issued and outstanding: 9,620,000 Instructions: A. Prepare the journal entries necessary to record a 90% stock dividend. B. Without reg

An Exact Sampling Plan

The personnel manager at a company wants to investigate job satisfaction among the female employees. One evening after a meeting she talks to all 30 female employees who attended the meeting. Does this sampling plan result in a random sample? Simple random sample? Explain.

Identifying a Sampling Plan

A polling company obtains an alphabetical list of names of voters in a precinct. They select every 20th person from the list until a sample of 100 is obtained. They then call these 100 people. Does this sampling plan result in a random sample? Simple random sample? Explain.

Identifying a Sampling Plan for a Situation

An education expert is researching teaching methods and wishes to interview teachers from a particular school district. She randomly selects ten schools from the district and interviews all of the teachers at the selected schools. Does this sampling plan result in a random sample? Simple random sample? Explain.

Comparing Two Sets of Results

When investigating times required for drive-through service, the following results (in seconds) were obtained. Find the range, variance, and standard deviation for each of the two samples, then compare the two sets of results. Restaurant A: 120 123 153 128 124 118 154 110 Restaurant B: 115 126 147 156 118 110

Determining Standard Deviation

To get the best deal on a CD player, Tom called eight appliance stores and asked the cost of a specific model. The prices he was quoted are listed below: $ 298 $ 125 $ 511 $ 157 $ 231 $ 230 $ 304 $ 372 Find the Standard deviation

Business Statistics - using data decisions

Please provide an answer with an explanation of how you obtained the answer so I can understand. Thanks! Question 1 What scale of measurement would you use when collecting data to represent the average monthly temperature for the city of Fort Wayne? Answer Nominal Ordinal Interval Ratio Question 5 An emplo

Finding the Median Distances

The distances (in miles) driven in the past week by each of a company's sales representatives are listed below. 45 70 242 268 452 490 640 Find the median distance driven. (Must show work)

Find the Mean Exam Time Amount

The amount of time (in hours) that Sam studied for an exam on each of the last five days is given below. Find the mean study time. 3.7 8.2 8.7 6.4 4.6 (Must show work)

Find the Median Newspaper Sold

A store manager kept track of the number of newspapers sold each week over a seven-week period. The results are shown below. Find the median number of newspapers sold. 36 30 201 180 278 242 310 (Must show work)

Probability that a Student is from Kenilworth

In a certain class of students, there are 15 boys from Wilmette, 5 girls from Kenilworth, 9 girls from Wilmette, 6 boys from Glencoe, 2 boys from Kenilworth and 8 girls from Glencoe. If the teacher calls upon a student to answer a question, what is the probability that the student will be from Kenilworth? (Must show work).