Use the Following Information to Answer the Question(s)below

question 30

Multiple Choice

Use the following information to answer the question(s) below.
Taggart Transcontinental pays no dividends,but spent $4 billion on share repurchases last year.Taggart's equity cost of capital is 13% and the amount spent on repurchases is expected to grow by 5% per year.Taggart currently has 2 billion shares outstanding.
-Taggart's stock price is closest to:

• A)$12.50.
• B)$15.40.
• C)$20.00.
• D)$25.00.

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Definitions:

Salary

A fixed amount of wages paid to an employee on a regular basis for a prescribed period of time, for example, weekly or monthly.

Fixed Amount

A specific, unchanging sum of money that is agreed upon for transactions, payments, or financial obligations.

Benefits

Sometimes known as fringe benefits.

Paid Time Off

A workplace policy where employees are provided with a certain amount of days for which they are paid while being allowed to take time off from work.