What is the total economic cost of the transaction

Assignment Help Financial Management

Reference no: EM131835697

What is the total economic cost (in dollars) of the following transaction? (Compute the cost of the transaction only, not the value of the asset). I buy 100 shares of Acme Widget Corp. stock. The price of the stock is $20 per share. The brokerage fee is $50 and I had to pay $10 for an online Internet research firm to find the company that best suited my investment needs. I anticipate that during the year I will receive $0.50 in dividends and the stock price will appreciate to $24 per share. Rather than buy the stock, I could have deposited that money is a savings account earning 1% interest, a money market account earning 2% interest, a CD earning 3% interest or an Acme Widget Corp. bond earning 5% interest.

Reference no: EM131835697

Questions Cloud

Should marijuana be legalized : Should Marijuana be legalized? Economically how would it impact the US?

What would be the value of the investment in three months : Ignore transaction costs. What would be the value of the investment in three months if the money is invested in the U.S. or Great Britain?

What is the monopolist marginal revenue function : Now consider a monopolist. What is the monopolist's marginal revenue function, MR(Q)?

Explain how cash and accrual accounting differs : Explain how cash and accrual accounting differs for each of the events listed in the above scenario and describe the proper accrual accounting.

What is the total economic cost of the transaction : What is the total economic cost (in dollars) of the following transaction? (Compute the cost of the transaction only, not the value of the asset).

Analyze what relevant laws that govern privacy in workplace : Analyze what are the relevant laws that govern privacy in the workplace? How can workers take advantage of the protections that these laws provide?

Informal work and dead capital : "Dead capital" is Hernando de Soto's term for an asset that cannot easily be bought, sold, valued or used as an investment.

What are some predatory lending practices : There are so many circumstances when the principles of the 5 C's of credit can be applied. Please name one and discuss how one of the 5 C's comes into play.

List distinct reasons why people resist change : List at least five distinct reasons why people resist change. Explain the nature and implication of each reason (one paragraph per reason)

User Account

All Pages