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Question 2: Answer the following with your reasonings and state your assumptions clearly (if any)
Shivam Rubber Ltd. is expected to pay a dividend of 20% in the upcoming year on a share with a face value of Rs. 10. Dividends are expected to grow at the rate of 6% per year. The risk-free rate of return is 5% and the expected return on the market portfolio is 13%. The share of the Company has a beta of 1.2. You are required to determine the intrinsic value of the share of the company and give your reasoning for arriving at the value.
Identify the main causes of the financial crisis of 2008? identify the main risks that contributed to the crisis
Problem two: Aluminium pricing
For this question, refer to the article from The Economist magazine titled “A coup in
Guinea adds fuel to aluminium’s red-hot rally”.
a) The article identifies a number of factors behind the recent increase in the price of
aluminium.Mentionthesefactorsandindicatewhethertheyaredemand-sideorsupply-
side factors.
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b) With the aid of a well-labeled diagram, illustrate the effects of the factors identified
in part (a) above on the equilibrium price and quantity of aluminium. Pay attention to
the statement in the article that “Supply constraints, however, have been more
important”whendrawingyourdiagram
The weekly demand for sandwiches at a local sandwich shop is given by:
Qd = 2,000 – 5P + 2Pj – 0.01INCOME,
where Qd is the number of sandwiches demanded per week, P is the per-sandwich price, Pj is the price of a related product, and INCOME is the average monthly income of consumers.
Suppose that P = $10, Pj = $50, and INCOME = $5,000. What is the value of the cross-price elasticity of demand? Is the related product a substitute good or a complement?
Suppose that P = $10, Pj = $50, and INCOME = $5,000. What is the value of the income elasticity of demand? Are sandwiches a normal or an inferior good?
Use the following data to answer the following questions
Year Real GDP per Capita (2012 Prices)
2013 $ 47719
2014 $48,116
2015 $48,822
2016 $49,184
2017 $50,010
a. What is the percentage change 2013 to 2017?
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What is the average annual growth 2013 to 2017?
Suppose you are a perfectly competitive firm producing computer memory chips. Your production capacity is 1000 units per year. Your marginal cost is $10 per chip up to capacity. You have a fixed cost of $10,000 if production is positive and $0 if you shut down. What are your profit-maximizing levels of production and profit if the market price is (a) $5 per chip, (b) $15 per chip, and (c) $25 per chip? For case (b), explain why production is positive even though profits are negative.
If gdp doubled in 10 years, what was the average annual growth rate?
Discuss key sources of innovative funding citing relevant examples (10 mrks)
Key Insurance Agency was organized on October 1, 2020. Assume that the accounts are closed and financial statements prepared each month. The company occupies rented office space but owns office equipment estimated to have a useful life of 10 years from date of acquisition, October 1. The trial balance for Key Insurance Agency at December 31 is shown below.
Cash $22,565
Accounts Receivables 7.050
Office Equipment 9,600
Accumulated Depreciation: Office Equipment 160
Accounts Payable 2,260
Income Taxes Payable 4,965
Capital Stock 20,000
Retained Earnings 7,450
Dividends 2,500
Commissions Earned 31,080
Advertising Expense 2,400
Salaries Expense 18,000
Rent Expense 3,800
Totals $65,915 $65,915
calculate taxable income fore the month of December using 40% corporate rate
prepare income statement , statement of retained earing for the month ended December 31,2020
If the water bill rises, but the government decides to support families to acvieve the same living standars as before the rise of the water price, what would be the total effect of the price rise into substitution and income effect?
