Consider the Portion of the Sensitivity Analysis Report That Follows

question 17

Multiple Choice

Consider the portion of the sensitivity analysis report that follows.Decreasing the right-hand side constraint by 1 unit for $I$8 (from 150 to 149) will result in which of the following? $$\begin{array} { | l | l | l | l | l | l | l | } \hline \text { Cell } & \text { Name } & \begin{array} { l } \text { Final } \\\text { Value }\end{array} & \begin{array} { l } \text { Shadow } \\\text { Price }\end{array} & \begin{array} { l } \text { Constraint } \\R \mathrm { H } \text {. Side }\end{array} & \begin{array} { l } \text { Allowable } \\\text { Increase }\end{array} & \begin{array} { l } \text { Alowable } \\\text { Decrease }\end{array} \\\hline \$ 1 \$ 7 & \begin{array} { l } < = \\\text { Usage }\end{array} & 240 & 0.6 & 240 & 210 & 40 \\\hline \$ 1 \$ 8 & \begin{array} { l } < = \\\text { Usage }\end{array} & 150 & 3.2 & 150 & 30 & 70 \\\hline\end{array}$$

• A)decrease the profit by $0.6
• B)increase the profit by $3.2
• C)increase the profit by $0.6
• D)decrease the profit by $3.2

Understand the valuation of stocks that do not currently pay dividends but will in the future.

Calculate the required rate of return for preferred stock investments.

Determine the dividend yield of a stock and its impact on total return.

Understand the implications of dividend growth on stock valuation and investor's return.