You are invited to participate in a new company. The company is projected to payout $10,000 in the first year, and after that the payouts will grow by an annual rate of 6 percent forever. If you can invest the cash flows at 8 percent, how much will you be willing to pay for this perpetuity
Answers (1)
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “You are invited to participate in a new company. The company is projected to payout $10,000 in the first year, and after that the payouts ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Ajax common stock is expected to return 17 percent in a boom economy, 11 percent in a normal economy, and 2 percent in a recession. The probability of a boom is 25 percent, of a normal economy is 70 percent, and of a recession is 5 percent.
Answers (1)
Ang Electronics, Inc., has developed a new DVDR. If the DVDR is successful, the present value of the payoff (when the product is brought to market) is $33.5 million. If the DVDR fails, the present value of the payoff is $11.5 million.
Answers (1)
You are planning to make monthly deposits of $400 into a retirement account that pays 10 percent interest compounded monthly. if your first deposit will be made one month from now, how large will your retirement account be in 30 years?
Answers (1)
Some people have jobs some people go to college. assuming these two statements are true most people that attend college have jobs
Answers (1)
An asset was purchased for $111,000 on January 1, Year 1 and originally estimated to have a useful life of 8 years with a residual value of $13,500.
Answers (1)
New Questions in Business
Quincy listed information from his credit report. Which list could Quincy have written? A previous address, current address, bankruptcy, car loan payment history current B address, monthly income, car loan payment history, date of birth C previous
Answers (1)
Carol wants to invest money in a 6% CD account that compounds semiannually. Carol would like the account to have a balance of $130,000 7-years from now. How much must Carol deposit to accomplish her goal?
Answers (1)
At the end of 2016, Nash's Trading Post, LLC has accounts receivable of $635,600 and an allowance for doubtful accounts of $23,140. On January 24, 2017, it is learned that the company's receivable from Madonna Inc.
Answers (1)
United Birdseed is expected to pay the following dividends over the next three years: After year 3, dividends are expected to grow by 5% per year forever. The expected/required return on United Birdseed stock is 10%. What is the stock price?
Answers (1)
Halestorm Corporation's common stock has a beta of 1.13. Assume the risk-free rate is 4.8 percent and the expected return on the market is 12.3 percent. What is the company's cost of equity capita?
Answers (1)