1. If a stock is expected to pay a dividend of $ 25 for the current year, what is the approximate present value of this stock, given at discount rate of 10 % and a dividend growth rate 2 %.
2. Suppose the price of beans rises from $1.00 a pound, to $2.00 a pound quantity demanded falls from 10 units to 6 units, compute the coefficient of elasticity of demand for beans using the arc elasticity approach.
3. If a price of corn is $ 3.00 a bushel, 5000 bushels would be demanded. if the price rises to $ 4.00 a bushel , 4000 bushel would be demanded.
A. what is the arc price elasticity of demand ?
B. based on this answer, if the price of corn rose to $ 5.00 a bushel , what would be the demand for corn ?
C. if the price of corn decreased from 4.00 to $ 3.00 a bushel , what would be the change in total revenue for sellers of corn ?
D. if the price of corn increased from 4.00 to $ 5.00 a bushel, what would be the change in total revenue for sellers of corn ?