Problema stock just paid a dividend of 160 per year the, Ask an Expert

Finance

Problem:

A stock just paid a dividend of $1.60 per year. The dividend is expected to grow at 3% per year indefinately. Equally risky stocks offer expected rates of return of 8%.

Required:

Question 1: What should be the stock price?

53.33
$16.00
$32.96
None of the above.

Note: Show all workings.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M91162790

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