You Have Decided You Would Like to Own Some Shares

question 199

Multiple Choice

You have decided you would like to own some shares of the Clean Coal Company but need a 16% rate of return to compensate for the perceived risk of such ownership. What is the maximum you are willing to spend per share to buy this stock if the company pays a constant $1.75 annual dividend per share?

• A) $9.19
• B) $10.94
• C) $12.69
• D) $18.60
• E) $22.81

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