Problemgen corp is expected to pay a dividend of 340 per, Ask an Expert

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Problem:

Gen Corp. is expected to pay a dividend of $3.40 per year indefinitely. The appropriate rate of return on this stock is 10 percent per year, and the stock consistently goes ex-dividend 30 days before dividend payment date.

Required:

Question 1: What will be the expected minimum price in light of the dividend payment logistics?

Question 2: What will be the expected maximum price in light of the dividend payment logistics?

Note: Be sure to show how you arrived at your answer.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91167829

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