What constant rate does owner believe that profits will grow

Assignment Help Business Economics

Reference no: EM13995849

You’ve recently learned that the company where you work is being sold for $390,000. The company’s income statement indicates current profits of $27,000, which have yet to be paid out as dividends. Assuming the company will remain a “going concern” indefinitely and that the interest rate will remain constant at 11 percent, at what constant rate does the owner believe that profits will grow?

Reference no: EM13995849

Questions Cloud

What are the determinants of aggregate demand : Illustrate the effects of changes in various factors on a nation's aggregate demand. Include expectations about the future expectations, fiscal policy, monetary policy, and changes in the world economy. What are the determinants of aggregate demand? ..

A precise definition of globalization is difficult : A precise definition of globalization is difficult, because globalization is a process which removes economic, social and cultural boundaries of nation states. Discuss this process. Do you think that globalization is a win-win situation for all count..

Net domestic product-depreciation of physical capital : Net domestic product (NDP) typically only accounts for depreciation of physical capital. However, there are three broad types of capital: physical, human, and natural. Should depreciation of the other two types of capital also be counted? Explain, pr..

Estate bubble by increasing banks required reserve ratio : In recent years, China’s central bank has been attempting to combat a significant real estate bubble by increasing banks’ required reserve ratio. What are Chinese policy makers seeking to achieve?

What constant rate does owner believe that profits will grow : You’ve recently learned that the company where you work is being sold for $390,000. The company’s income statement indicates current profits of $27,000, which have yet to be paid out as dividends. Assuming the company will remain a “going concern” in..

Cause the demand curve for rice to shift to the left : Which of the following would cause the demand curve for rice to shift to the left?

What is the rationale behind the taylor rule : What is the rationale behind the Taylor rule?

The efficient market hypothesis : The efficient Market hypothesis

Bank credit channels of monetary policy transmission operate : Explain how the bank credit channels (two channels) of monetary policy transmission operate. Illustrate with the scenario where the Federal Reserve Bank undertakes an open market purchase.

User Account

All Pages