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NEW QUESTION: 1
Assume the following information for the common stock of Clay Industries, a large industrial firm:
Required rate of return on equity: 14.5% per year
Expected growth rate: 12.50% per year
Dividend at t0: $0.70
Assuming that the growth rate will remain constant, what is the projected value of Clay Industries common stock?
A. $32.78
B. The answer cannot be calculated from the information provided
C. $30.76
D. $35.34
E. $39.38
F. None of these answers
Answer: E
Explanation:
Explanation/Reference:
Explanation:
In this example, the growth rate of dividends is assumed to remain stable, allowing the use of the Gordon Model. The Gordon Model is also known as the "constant growth dividend discount model" and takes the following form:
P0 = [D1 / (r - g)]
Where
P0 = the price of common stock X at time 0
D1 = the expected dividend at t1
r = the required rate of return on equity investments and g = the expected growth rate of dividends.
Since the dividend at t1 is not provided, we must calculate it manually by multiplying the dividend at t0 by (1 + g). This will produce an answer of $0.7875 at t1.
Now that the dividend at t1 has been determined, the given information can be put into the equation provided, leading to the following series of calculations:
P0 = [$0.7875 / (.145 - .125)] = $39.38.
When using the Gordon model, remember that the required rate of return "r" must be greater than the expected growth rate "g." Otherwise, this equation will produce a nonsensical answer.

NEW QUESTION: 2
What is an advantage of IBM XIV compared to EMC VMAX?
A. Ease of management
B. Software priced by capacity
C. Professional migration services
D. Fully automated software tiering
Answer: B
Explanation:
Reference:
http://www-05.ibm.com/ie/presentations/2011_pdf/4_XIV_Storage_Efficiency.pdf

NEW QUESTION: 3
Your network contains an Active Directory domain named contoso.com. You deploy Active Directory Certificate Services (AD CS).
Your company, which is named Contoso, Ltd., has a partner company named Fabrikam, Inc. Fabrikam also deploys AD CS.
Contoso and Fabrikam plan to exchange signed and encrypted email messages.
You need to ensure that the client computers in both Contoso and Fabrikam trust each other's email certificates. The solution must prevent other certificates from being trusted and minimize administrative effort.
What should you do?
More than one answer choice may achieve the goal. Select the BEST answer.
A. Exchange the root certification authority (CA) certificates of both companies, and then deploy the certificates to the Trusted Root Certification Authorities store by using Group Policy objects (GPOs).
B. Implement an online responder in each company.
C. Implement cross-certification in each company.
D. Exchange the root certification authority (CA) certificates of both companies, and then deploy the certificates to the Enterprise Trust store by using Group Policy objects (GPOs).
Answer: C