Bill, Jim and Shelly are all looking to buy the same stock that pays dividends. Bill plans on holding the stock for one year. Jim plans on holding the stock for three years. Shelly plans on holding the stock until she retires in 10 years. Which one of the following statements is correct?

1. Bill will be willing to pay the most for the stock because he will get his money back in one year when he sells.
2. Jim should be willing to pay three times as much for the stock as Bill because his expected holding period is three times as long as Bill's.
3. Shelly should be willing to pay the most for the stock because she will hold it the longest and hence she will get the most dividends.
4. All three should be willing to pay the same amount for the stock regardless of their holding period.

4. All three should be willing to pay the same amount for the stock regardless of their holding period.

Explanation:

Bill, Jim  and Shelly should be willing to pay the same amount of money to purchase this dividend-paying stock. This is because, the price of the stock today depends on the expected future dividends which when discounted, results in the intrinsic value of the stock. This is based on dividend discount model(DDM) of stock valuation. Therefore, the value of the stock  today does not depend on the holding period.

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"we first find value of tax in dollars.

the difference between the two prices   is: 23. 54 - 22 = 1.54

therefore the sales tax in dollars is 1.54

the tax % will be   (amount of tax / original cost price ) × 100

(1.54 / 22) × 100  → (0.07) × 100 =   7

so the tax rate is 7%

we can double check the answer.

7 % of 22   → (7/100) × 22 → 0.07 × 22 = 1.54

22 + 1.54 = 23.54"

these are the four factors that influence enterpreneurship development

1. economic development

2. culture

3.technological development

4. education