Use the Information for the Question(s)below

question 2

Multiple Choice

Use the information for the question(s) below.
Von Bora Corporation is expected to pay a dividend of $1.40 per share at the end of this year and a $1.50 per share at the end of the second year.You expect Von Bora's stock price to be $25.00 at the end of two years.Von Bora's equity cost of capital is 10%.
-Suppose you plan to hold Von Bora stock for only one year.Your capital gain from holding Von Bora stock for the first year is closest to:

• A)$0.95.
• B)$1.40.
• C)$1.85.
• D)$1.25.

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Definitions:

Hasty Generalization

A conclusion is drawn from an unrepresentative or insufficiently sized sample.

Loaded Question

A fallacy that assumes a particular answer to another unasked question.

Unwarranted Assumption

An argument based on a premise which lacks evidence to support it, leading it to be erroneous.

Natural

Existing in or derived from nature; not made or caused by humankind.