If dividends are expected at regular intervals forever, Ask an Expert

Management Studies

If dividends are expected at regular intervals forever, then this is like preferred stock and is valued as a perpetuity P0 = D / R Suppose stock is expected to pay a $0.50 dividend every quarter and the required stated return (not APR) is 10% with quarterly compounding. What is the price?

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Business Management, Management Studies

Category:- Business Management
Reference No.:- M9116231

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