Exhibit 14 -A Firm Has a Current Price of $40 a Share,an

question 90

Multiple Choice

Exhibit 14.5
Use the Information Below for the Following Problem(S)
$$\begin{array} { l c c } & \text { Wal-Elue } & \text { Industry } \\ \text { DPS } & 1.00 & 1.50 \\\text { Total As5et Tunover } & 3.20 & 2.50 \\\text { Net Profit Marpin } & 3.50 \% & 3.00 \% \\\text { EpS } & 4.00 & 3.00 \\\text { Total As5ets/Equity } & 3.00 & 4.00\end{array}$$
-A firm has a current price of $40 a share,an expected growth rate of 11 percent and expected dividend per share (D1) of $2.Given its risk you have a required rate of return for it of 12 percent.Assuming that you expect the stock price to increase to $42 during the investment period,your expected rate of return and decision would be:

• A) 10% - do not buy
• B) 12% - do not buy
• C) 14% - buy
• D) 16% - buy
• E) 18% - buy

Understand the concept of consumer equilibrium and how it is depicted graphically.

Interpret indifference curves and budget constraints in consumer choice theory.

Identify points of maximal utility given budget and price constraints.

Recognize attainable and unattainable utility levels within the context of consumer budget constraints.

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Definitions:

Trade Discount

A reduction in the listed price of goods or services offered by a vendor to buyers in the same trade.

Channel Members

Channel members refer to the set of intermediaries that a product passes through from production to final sale, including wholesalers, distributors, and retailers.

Services Perform

The process of executing or delivering a service to fulfill a need or requirement of a customer.

Markup

The amount added to the cost price of goods to cover overhead and profit; the percentage increase on the original cost.