Problema stock currently trading at 50 expects to pay a 450, Ask an Expert

Finance

Problem:

A stock, currently trading at $50, expects to pay a $4.50 dividend this year. The dividends and stock price has been growing at 8% for 10 years.

Required:

Question: What is the expected return on the stock this year?

17%
18%
19%
Below the required market rate of return

Note: Show all workings.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91175103

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