Problemthe dividend yield on alphas common stock is 52 the, Ask an Expert

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Problem:

The dividend yield on Alpha's common stock is 5.2%. The company just paid a $2.10 dividend. The rumor is that the dividend will be $2.3 next year. The dividend growth rate is expected to remain constant at the current level.

Required:

Question: What is the required rate of return on Alpha's stock?

14.70%
12.31%
18.29%
20.01%
24.21%

Note: Show all workings.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M91166206

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