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.

---

Definitions:

Veins

Blood vessels that carry deoxygenated blood towards the heart from the body's tissues.

Tunica Media

The middle layer of the wall of blood vessels, made up of smooth muscle cells and elastic fibers.

Tunica Externa

The outermost layer of a blood vessel, composed of connective tissue, which provides structural support and flexibility.

One-Way Valves

Valves, particularly found in the veins and heart, that allow blood to flow in one direction and prevent backflow.