Kinston Industries Just Announced That It Will Cut Its Dividend

question 64

Multiple Choice

Kinston Industries just announced that it will cut its dividend from $3.00 to $2.00 per share and use the extra funds to expand its operations.Kinston's dividends were expected to grow at a 2% rate,and its share price was $37.50.With the new expansion,Kinston dividends are expected to grow at a 5% rate.Kinston's share price following this announcement should be:

• A)$20.00.
• B)$30.00.
• C)$37.50.
• D)$40.00.

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Definitions:

Afferent Arteriole

A small artery that leads into the glomerulus of the kidney, where it divides into capillaries for blood filtration.

Efferent Arteriole

A small blood vessel that carries blood away from the glomeruli of the kidney.

Filtration Membrane

A barrier that separates particles or molecules based on size during the process of filtration.

Electric Charge

A physical property of matter that causes it to experience a force when placed in an electromagnetic field.