a firm has a steady growth rate of 5% per year in its dividend and this growht rate is expected to continue indefinetly. last year's dividend was $1.20. if the investor requries a 9% return, what is the value of this stock

Answers

Answer 1

As a result, if the investor needs a 9% return, the stock's value will be $31.50.

What is growth rate?

For the time under consideration, divide the gap between both the beginning and ending values by the starting value to get growth rates. Annual, quarterly, monthly, and weekly are the most common time periods for growth rates. Since it tells us about an economy's size and health, GDP is important. A common indicator of the state of the economy is the real GDP growth rate. A rise in real GDP is generally regarded as a sign that the economy is doing well.

Why do we use growth rate and what is the formula of it?

Growth rates enable comparisons between entities of various sizes, such as the country and Texas. Furthermore, growth rates make it simple to compare indicators across time periods. Growth rate: A measurement of the percentage change that shows how quickly an economic indicator is rising or declining over a specific period of time.

To calculate the growth rate, subtract the current value from the previous one. The difference is then multiplied by the prior figure and divided by 100 to determine the growth rate as a percentage.

Briefing:

As we know that

The value of the stock is = Dividend × (1 + growth rate) ÷ (required rate of return - growth rate)

= $1.20 × (1 + 0.05) ÷ (9% - 5%)

= $31.50

hence, the value of the stock is $31.50

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Related Questions

What are the soft power tools of foreign policy?

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The way a nation interacts with the rest of the world is an important component of its foreign policy.

What are the Six Foreign Policy Instruments?

Diplomacy, the United Nations, the international monetary system, economic assistance, collective security, and military deterrence are the six main tools of contemporary American foreign policy. Understanding how foreign policy operates can help us understand why different countries behave in specific ways that serve a nation's interests.

1.Diplomacy

2.Armed Forces

3.Economic Strategies

4.Internet Security Guidelines

5.Policies for Environmental Protection

6.Energy Policies

Countries behave differently toward one another depending on how they engage with one another, which influences whether they can help or hurt one another. Like all foreign policy tools, soft power has its limitations and should not be considered the singular mechanism through which countries advance their national interests.

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One problem with​ business-to-business e-procurement is that it​ _______.
A.
increases paperwork requirements
B.
increases transaction costs
C.
reduces purchasing efficiency
D.
increases the time between order and delivery
E.
can erode​ long-standing customer-supplier relationships

Answers

One problem with​ business-to-business e-procurement is that it can erode​ long-standing customer-supplier relationships. While B2B e-procurement offers many advantages, it also has some disadvantages.

One such problem is that it can disrupt long-term customer-supplier relationships. Indeed, e-procurement often involves the use of third-party vendors or web-based platforms, which can undermine the trust that has been built up over time between the customer and its supplier. E-procurement can also increase transaction costs because both the customer and the supplier must pay fees to third-party suppliers. All of these factors can lead to disruption of customer-supplier relationships, which can be detrimental to both the customer and the supplier.

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joe's taco hut can purchase a delivery truck for $20,000 and joe estimates it will generate a net income (after taxes, maintenance and operating costs) of $2,000 per year. he has no other opportunities. he should:

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Joe estimates that a delivery truck purchased for $20,000 will generate a net income (after taxes, maintenance, and operating costs) of $2,000 per year. He doesn't have any other options. He should pick one:

A purchase the truck only if the real interest rate is less than 2%. B, purchase the truck if the real interest rate is greater than 10%. C. not purchase the truck if the real interest rate is greater than 2%.D, purchase the truck if the real interest rate is less than 10%.

What is operating costs?Operating costs or operational costs, are the expenses which are related to the operation of a business, or to the operation of a device, component, piece of equipment or facility. They are the cost of resources used by an organization just to maintain its existence.fixed costs, which are the same whether the operation is closed or running at 100% capacity.Variable costs are costs that change as the quantity of the good or service that a business produces changes.[1] Variable costs are the sum of marginal costs over all units produced. They can also be considered normal costs. Fixed costs and variable costs make up the two components of total cost.

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Why must marketers be aware of new developments in technology?

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Marketers must be aware of new developments in technology because it can greatly impact the way they reach and connect with their target audience.

What are marketers?

Generally, the proliferation of mobile devices and the rise of social media have changed the way that people consume information and interact with brands. If a marketer is not aware of these changes, they may struggle to effectively promote their products or services.

Additionally, new technologies can also create new opportunities for marketing, such as the use of virtual and augmented reality in advertising.

By staying up-to-date with the latest technological developments, marketers can stay ahead of the curve and find new ways to engage with their customers.

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when marketing organizations communicate standardized (as opposed to customized) marketing messages to consumer segments they are using a(n) targeting approach.

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When marketing organizations communicate standardized (as opposed to customized) marketing messages to consumer segments they are using a mass targeting approach.

Mass targeting is a marketing approach where standardized messages are sent to a wide range of consumer segments. It is a form of undifferentiated marketing where a single message is sent to an entire audience regardless of their individual needs or wants.

It is used to spread awareness about a product or service to as many people as possible, instead of focusing on a specific target market. Using this approach, companies can reach a larger number of potential customers in a shorter period of time

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on august 1, 2021, turner manufacturing lends cash and accepts a $5,000 note receivable that offers 10% interest and is due in nine months. how would turner record the year-end adjustment to accrue interest in 2021?

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Interest revenue = $6,000 x 8% x 5/12 = $200 would turner record the year-end adjustment to accrue interest in 2021.

What is interest revenue?

A business can generate interest income in one of two ways: by lending money or by depositing and investing cash.

The first way is when a bank demands something in exchange for making a loan; this is one way that interest income is generated.

When a business deposits money with a bank or makes an investment there, the bank will pay the business interest on the deposit or investment.

Regardless of how interest money is generated, it is recorded on the income statement of the business.

Banks and other financial institutions view interest income as a significant portion of their revenue stream.

Debit: Interest Receivable 200

Credit: Interest Revenue 200

Interest revenue = $6,000 x 8% x 5/12 = $200.

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Which tree organization is responsible for 90% of the world trade?

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90% of all trade is regulated by the World Trade Organization (WTO).

What exactly does the WTO do?

The World Trade Organization (WTO) is the sole international body responsible for enforcing international trade regulations. Its major objective is to ensure that trade proceeds as smoothly, reliably, and freely as possible. Geneva, Switzerland, home to the WTO's headquarters, is a special location with numerous missions to the WTO from the United Nations and other organizations.

Who is in charge of the WTO?

Governments from the WTO's members run it. All significant decisions are taken by the entire membership, whether it be through the ministers, their ambassadors, or representatives.

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How does a Scrum Master help a team become collaborative and effective?

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A Scrum Master can help a team become collaborative and effective by first ensuring that all members of the team understand and are comfortable with the Scrum framework and its practices.

The Scrum Master can then facilitate meetings and discussions between the team members to foster a collaborative environment. The Scrum Master can also ensure that the team establishes a mutually agreed upon set of goals and objectives.

Additionally, the Scrum Master can provide coaching and guidance to team members to ensure that they are working collaboratively and effectively to achieve those goals. The Scrum Master can also ensure that the team is following the Scrum framework and make adjustments to the process as needed.

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What are PACS and explain what they do?

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PACS means political action committee. It is formed with a objective to collect funds from member of committee and then distributing it on the campaign of political candidates in order to make them win.

In 1943, when US government forbade unions to donate personally in political campaign, then PACs was formed. PACs also known political action committee is an organization formed with the motive to make a candidate win the election or defeat the other candidate by organizing the funds from its members, organization, association and individuals etc. It give funds to political drives, law making body, ballot etc. There are mainly five type of political action committee: Separate Segregated Funds, Nonconnected committees, Super PACs, Hybrid PACs and Leadership PACs. According to law, political action committee is not allowed to contribute more than 5000 dollar to a candidate.

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What are the 2 types of savings accounts available?

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There are different types of savings accounts to choose from, and they're not all alike. The options include traditional savings accounts, high-yield savings accounts, money market accounts, certificates of deposit, cash management accounts and specialty savings accounts.

Is there a downside to a savings account?Using a savings account is a practical way to keep your money safe and earning interest. With a savings account, you can keep your cash accessible and in a liquid state while also creating some breathing room between them and your regular spending requirements. Savings accounts frequently offer lower APYs than other interest-yielding alternatives like CDs. Limitations on accounts: Savings account restrictions can include minimum balance or deposit criteria, withdrawal thresholds, and a variety of restricted deposit or withdrawal methods.Savings accounts come in a variety of varieties, and they are not all the same. Traditional savings accounts, high-yield savings accounts, money market savings accounts, certificates of deposit, cash management savings accounts, and specialty savings accounts are available.

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Which of the following actions would be most likely to help your employees fulfill this drive?

a. Creating organizational policies that appear fair to everyone who looks at them
b. Making sure that all organizational processes are transparent

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Creating organizational policies that appear fair to everyone who looks at them would be most likely to help your employees fulfill this drive. So the option a is correct option.

Your most precious asset is your workforce, and effectively managing them is one of your biggest business difficulties.

A happy and effective workplace is built on open and honest communication. Begin by outlining to your staff your company's vision, objectives, and strategies for accomplishing them. In times of transition or uncertainty, pay particular attention to good communication.

Consider rewarding staff members when they achieve goals, contribute to innovation, or aid in the hiring of new employees. Performance bonuses and/or non-cash benefits, like a corporate dinner or concert tickets, are examples of rewards that can be given to employees.

You might need to provide a more flexible workplace because of shifting demographics.

Creating organizational policies that appear fair to everyone who looks at them would be most likely to help your employees fulfill this dri

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Why does the central bank increase interest rates during inflation?

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The Federal Reserve and other central banks around the world have raised hobby rates to curb inflation.

The motive behind elevating pastime charges is that the price of borrowing rises every time they are raised, and the incentive to shop and invest as an alternative than devour will increase due to better yields.

Why does hobby rate make bigger at some stage in inflation?

Even so, pastime rate hikes are recognized as the central bank's one most important device to lower inflation, which it does with the aid of elevating the cost of borrowing money to curb the demand for goods and services.

These are the benchmark charges that central banks are presently elevating to tame inflation. The common sense is primarily based on a cascading effect: if central banks charge higher rates to industrial banks, business banks in turn make bigger the rates they offer to households and groups who wish to borrow.

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What factors affect income tax?

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This article adds to the limited body of literature that empirically investigates the variables influencing the composition of state income taxes. We presume.

What element influences the amount of income tax withheld?

Withholding is the term used to describe the amount of federal income tax taken from an employee's paycheck. The amount you make and how much income tax your employer withholds from your regular paycheck are the two determining criteria.

What factors are involved in the income effect?

The term "income effect" refers to the change in consumer spending that depends on income. This suggests that if their income increases, people will generally increase their spending. They might spend less if their income drops. The outcome does not influence what goods consumers will buy.

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Enter the following transactions into richard’s checkbook register and state his ending balance: date type description amount 03/01 check

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richard’s checkbook MsEHolt \sAmbitious

4.1K solutions 83.8M people were aided

The right response is:

B) $1,009.81

Our starting point is the $944.88 amount in Richard's checking account.

After paying his rent of $455.00 to Blue Sky Apartments with Check #204, he has $944.88-455 = $489.88.

After being paid, he has $880.24 (489.88 + 390.36) plus the $390.36 automatic deposit.

He debits Benny's Hamburgers and Fries for $9.20 after eating out, leaving him with $880.24 less $9.20 for a total of $871.04.

He uses Check #205 for $251.59 to pay off his auto loan, leaving him with 871.04-251.59 = $619.45.

He will have 619.45 plus $390.36, or $1009.81, after getting his $390.36 automatic deposit checkbook.

The full question is here :

Richard’s checkbook register as of 02/19: Check # Date Description of Transaction Payment/Debit (-) Fee (-) Deposit/Credit (+) Balance 02/03 Deposit $900.00 $900.00 02/05 Deposit - Paycheck $390.36 $1,290.36 201 02/05 Blue Sky Apartments $455.00 $835.36 202 02/07 Renter’s Insurance $125.40 $709.96 203 02/18 Online Clothing Purchase $155.44 $554.52 02/19 Deposit - Paycheck $390.36 $944.88 Enter the following transactions into Richard’s checkbook register and state his ending balance: Date Type Description Amount 03/01 Check #204 Blue Sky Apartments $455.00 03/05 DEP Payroll automatic deposit $390.36 03/08 Debit Benny’s Hamburgers and Fries $9.20 03/15 Check #205 Car payment $251.59 03/19 DEP Payroll automatic deposit $390.36 a. $715.79 b. $1,009.81 c. $780.72 d. $880.24

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as an economist (not pundit), you have decided to compare and contrast different models. a. compare the impact of a tax cut on consumption, investment, saving, output, and interest rates in the is-lm model (module 4) versus the classical model (module 1) versus the solow growth model (module 2). b. lastly, what would happen to consumption, investment, saving, output, and interest rates according to the ricardian equivalence?

Answers

A fiscal contraction is the reduction of a government's deficit. A government runs a deficit when it spends more revenue than it brings in through taxes.

What does a company's revenue mean?

Your company's yearly revenue is the sum it makes from sales over the course of a year, excluding costs and expenses. The number of each goods you sold is multiplied by its purchase price, and the sum of the yearly sales of each product yields your gross annual turnover.

In simple terms, what is revenue?

The whole amount of money made by selling the customers' goods or services is referred to as revenue. On the income statement of, revenue is displayed at the top.

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What is always true in a closed economy?

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The domestication of goods and restricted foreign trades, whether import or export, are always true in case of a closed economy system.

A closed economy can be considered as an economy that has a system of functioning completely different from a perfectly competitive economy. This is largely because of the fact that there are certain barriers to trade in a closed economy, especially for the foreign buyers and sellers. Moreover, the systems of a closed economy are mostly in the hands of the administrative authorities, such as the central governments.

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Accounting Project (Excel)

Students are required to prepare Excel Spreadsheets with tabs for Journal Entries, T Accounts, Trial Balances, and Financial Statements.

Record all transactions and prepare financial statements within the Excel Spreadsheet

Requirements:

1) Using the Balance Sheet information, enter the beginning balances in the T-Accounts.

2) On the following sheet, use the Transaction Information to journalize entries, 1 – 10.

3) Post each entry into the T-Accounts. When finished journalizing, calculate the account balance for each T-Account.

4) Create an Unadjusted Trial Balance.

5) Journalize adjusting journal entries 1 – 4

6) Post Adjusting Journal entries to T-accounts

7) Prepare Adjusted Trial Balance

8) Prepare:

a. Income Statement

b. Statement of Owner’s Equity

c. Balance Sheet

9) Write the four closing entries, post them to the T-Accounts and determine the ending balance for each account.

10) Create the Post Closing Trial Balance from the T-accounts.

Transaction Information

Entry #

1. Supplies are purchased on account for $1,000.

2. One year of insurance is purchased for cash, costing $3,600.

3. Paid rent expense of $2,000 for current month.

4. The receivables from the prior month are collected.

5. The account payables from the prior month are paid.

6. Paid $750 of wage expenses to employees, of which $50 is accrued from the prior month.

7. Received $1,500 from a customer in advance of providing the services.

8. A $450 utility bill for the current month is received. Payment is due next month on the 15th.

9. Services are performed for customers on account. Invoices totaling $5,600 are mailed to the customers.

10. The owner withdrew $750 for personal use.

Additional information for adjusting entries (to be used after unadjusted trial balance is prepared):

1. Supplies on hand at the end of the month are $400.

2. Record one month of insurance expense.

3. Accrue $100 wages

4. The December 31 balance in Unearned Revenue is $1,000

Speedy Delivery Company

Balance Sheet

November 30, 2017

Assets Liabilities

Cash 7,000 Accounts Payable 290

Accounts Rec 3,000 Wages Payable 50

Supplies 100 Owner’s Equity

Speedy, Capital 9,760

Total Assets 10,100 Total Liab. & O.E. 10,100

Answers

In such a T- account, people demonstrate the balance of the an account at the beginning and end of a period (month or year).

Internal projects including such construction builds, product innovations, advertising campaigns, research as well as clinical research, long-term purchases, and company strategic planning are also included in project accounting. These are capital improvements with distinct beginning and ending dates that are not routine work.

A balance sheet is a financial statement that includes a company's assets, liabilities, equity funding, total debt, and so on at a given point in time. On one side of the balance sheet, assets are listed, and liabilities are listed on the other. A journal is indeed a book in which all of a company's transactions are documented for the very first time. Journalising is the procedure of recording transactions in a journal. Every transaction has two effects: one would be debited and another is credited.

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why is indirect characterization a more effective and efficient way to portray characters than direct characterization?

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By revealing a character's thoughts, emotions, and world view in various contexts, you provide your reader with a robust understanding of who your characters are. Indirect characterization strengthens your writing by showing, not telling.

This style involves the author demonstrating the audience how the character is via his thoughts, words, and actions. The author accomplishes this because, unlike poetry and epic, theatre does not have a narrator.It takes more time to establish a character through indirect characterisation, but it makes a stronger effect on the audience or readers. This is because the reader must deduce why the character acts in a given way. What type of characterisation is most commonly utilised in drama? Characterization based on context motive-driven characterisation direct characterization indirect characterisation

why is indirect characterization a more effective and efficient way to portray characters than direct characterization?

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What is one way a command economy affects?

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Supply and demand factors, which determine what, how much, and at what price goods and services should be produced, are not allowed under a command economy.

Instead, all economic activity are planned, coordinated, and under the direction of a single government, which discourages market competition.

What is command economy?

A command economy is a crucial component of a political system in which the degree of output that is permitted and the prices that may be paid for goods and services are set by a central governing body. Most industries are owned by the public.

The principal alternative to a command economy is a free market economy where supply and demand determine prices and output.

A communist political system includes a command economy, whereas capitalist countries have a free market.

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Describe the effect of the growth of the plantation economy.

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Cash crops are the main source of income in plantation economies. The plantation system led to a society that was severely class divided. Plantation owners were affluent aristocrats who set their own standards and customs.

An economy focused on agricultural mass production, typically of a few commodity crops, cultivated on huge farms tended by laborers or slaves is known as a plantation economy. Plantations are the names of the properties. Cash crops are the main source of income in plantation economies.

Plantations become more productive the longer the crop's harvest season lasts. When the distance to the market is great, economies of scale can also be attained. Plantation crops typically require processing as soon as they are harvested. Plantations are best suited for sugarcane, tea, sisal, and palm oil; cotton, coconuts, and rubber are less ideal.

The plantation system led to a society that was severely class divided. Plantation owners were affluent aristocrats who set their own standards and customs.

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Who benefited from NAFTA?

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In short, NAFTA created a large free-trade region decreasing or eliminating tariffs on imports and exports between the three taking part nations (the U.S, Mexico, and Canada). Overall, there was once an extend in trade between the three countries, and actual per-capita GDP additionally elevated slightly.

Who received the most from NAFTA?

In the years due to the fact that NAFTA, exchange between the United States and its North American neighbors extra than tripled, developing more unexpectedly than U.S. trade with the rest of the world. Canada and Mexico are the two greatest destinations for U.S. exports, accounting for greater than one-third of the total.

Who negatively affected from NAFTA?

Mexico's Farmers Were Put Out of Business

6 When NAFTA removed exchange tariffs, groups exported corn and different grains to Mexico under cost. Rural Mexican farmers should no longer compete. At the identical time, Mexico decreased its subsidies to farmers from 33.2% of whole farm income in 1990 to 13.2% in 2001.

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Online contracts must be displayed:
a. in color. b. in a readable format. c. in black and white. d. in large font.

Answers

Online contracts must be displayed in a readable format.

Online contracts and privacy policies are pre-written, standardized agreements that cannot be changed and they should be in a readable format. This format will enable an individual to easily read the contract and understand it well so as to know what the individual is getting into before signing.

Nevertheless, they have legal force. They operate under the presumption that users have the option to reject these agreements.  Online electronic contracts eliminate the need for paper by allowing the agreement to be viewed and signed digitally. As an illustration, imagine creating a contract for goods or services on a computer and emailing it to a company. The contract is then read, electronically signed, and accepted by an authorized representative of the business through email.

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which of the following shifts aggregate demand to the right? a. an increase in the price level b. an increase in the money supply c. a decrease in the price level d. a decrease in the money supply

Answers

Correct option is B, a increase in the money supply shifts aggregate demand to the right.

What is the Money Supply?

The money supply is the total amount of cash and other liquid assets in an economy on the measurement date. The money supply roughly consists of both physical currency and deposits that may be accessed almost as quickly as physical currency.

Governments print and issue coin and paper money through a combination of their central banks and treasuries. Bank regulators control how much money is available to the general public by setting reserve holding requirements on banks, prescribing how to extend credit, and managing other monetary difficulties.

The money supply is the total amount of currency or cash used in a given economy.

Non-cash assets like credit and loans are taken into account in a number of assessments of the money supply.

All other things being equal, monetarists assert that increasing the money supply causes inflation.

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Which principles within the AICPA Code of Professional Conduct require a practitioner to be free from conflicting interests?

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The AICPA Code of Professional Conduct requires that practitioners have no conflict of interest in order to provide quality service to their clients. Principle 101 states that members should not accept professional engagements if the member's independence is likely to be significantly impaired.

Principle 102 states that members should not accept an engagement if they have a financial interest in the client, a close personal relationship with the client, or if they have an interest in the subject matter of the engagement.

Principle 103 states that members should not accept an engagement unless they are able or willing to act objectively and in the best interests of the client. Finally, Principle 201 states that members should not engage in activities that could be considered self-dealing or client exploitation. These principles are essential to ensure that professionals remain independent and provide the best possible service to their clients.

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Which is a sprint event?

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A product owner, scrum master or project manager, and scrum team collaborate throughout time-boxed sprints, which can last anywhere from one week to one month, to finish a given product addition.

All subsequent sprints should follow the team's decision about the number of days that a sprint should last. A sprint typically lasts 30 days. Once a sprint has started, the product owner must take a back seat and allow teamwork. The team has daily stand-up meetings during the sprint to go over progress and come up with solutions to problems. The project owner is permitted to witness these sessions but is not permitted to participate except to respond to queries.

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What are the 4 factors of production and examples?

Answers

The four production variables are labor, capital, land, and entrepreneurship.

What are the four production factors, and what do they each mean?

Land, labor, capital, and entrepreneurship are the four categories into which marxists divide the factors of production. Land is the primary factor of production, but term also applies to any other natural resource needed to create commodities and services. Anything derived from land is included in this, not simply actual land directly.The act of producing anything for consumption involves combining many material and non - material components. It refers to the act of creating an output that has value and improves folk's utility, such a good or service. The efficient use of the initial inputs immediately influences the production process and the result. The three primary production components are seen as being land, labor, and capital.

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Under what circumstances is the auditor permitted to breach client confidentiality?

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Circumstances such as when required by law, when there is a risk of imminent harm, or when the auditor believes the client has committed a crime.

Auditors may also be required to report certain financial information to the government or other regulatory bodies In some cases, an auditor may be required to breach client confidentiality in order to comply with laws and regulations. For example, the auditor may be required to disclose certain information to regulators or other government authorities in order to comply with securities laws. Additionally, an auditor may be required to disclose information to comply with anti-money laundering laws or other banking regulations.

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which of the following is an example of the use of a hypothesis? a. a belief that the covid economic-growth/health-wellbeing trade off exists and gathering supporting information. b. expressing an opinion that the economic-growth/health-wellbeing tradeoff should not influence policy. c. arguing that protecting the population from the coronavirus is more important than the economy. d. testing the economic-growth/health-wellbeing tradeoff to see if it is consistent with available information.

Answers

The correct answer is is D because a hypothesis is a testable idea. Please mark brainliest I need three more

Which project stakeholder management process has the goal of working with stakeholders to meet their needs and expectations?

Answers

Management Stakeholder Engagement process project stakeholder management process has the goal of working with stakeholders to meet their needs and expectations.

The management stakeholder engagement process is the communication and collaboration with stakeholders to satisfy their requirements and expectations, address problems as they arise, and establish appropriate stakeholder engagement in project activities over the course of the project. It contains organisational process assets, a change-log, a stakeholder management plan, and a communications management plan. A list of the stakeholders' communication needs is included in the communications management strategy. Each stakeholder has a different need for information, hence each stakeholder may require a different format, level of detail, topic, and language. As inputs for managing stakeholder engagement, all of this must be taken into account. In order to manage stakeholder engagement, a variety of tools and approaches are employed, including email and other powerful communication tools.

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Microsoft faces very little competition from other firms for its windows software. why isn’t the price of the software $10,000 per copy?

Answers

Microsoft would sell so few copies of its Windows software that they would make more money by selling at a reduced price, the company confronts relatively little competition from other businesses.

A company operating in a market segment with little or no competition is said to have a monopoly. As a result, it has complete control over the conditions and costs it charges clients, which greatly increases its profitability.

There are several ways for a corporation to control its market, even if monopolies are undesirable and prohibited.

The quickest way for a corporation to become a monopoly is for the government to grant it exclusive rights to offer goods or services.

Government-created monopolies are intended to lead to economies of scale that lower consumer prices.

The business can sell more copies while still making money if there is a predetermined pricing and no production costs. Because Microsoft would sell so few copies of its Windows software that it would make more money by selling at a reduced price, the corporation would have relatively little competition from other businesses.

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