The In-Tech Co

question 23

Multiple Choice

The In-Tech Co. just paid a dividend of $1 per share. Analysts expect its dividend to grow at 25 percent per year for the next three years and then 5 percent per year thereafter. If the required rate of return on the stock is 18 percent, what is the current value of the stock?

• A)$12.97
• B)$11.93
• C)$15.20
• D)$15.78

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Definitions:

Conscious

Being cognizant and reflective of one's own life, perceptions, thoughts, the environment, and life events.

Rational Way

Approaching situations and problem-solving based on logical reasoning, facts, and systematic thought processes.

Unconscious Processes

Mental activities outside of conscious awareness, influencing thoughts, feelings, and behaviors according to psychoanalytic theory.

Self-actualization

Attaining one's full talents and possibilities, regarded as an innate desire or motivation present in all individuals.