The Next Dividend Is Expected to Be $1

question 293

Multiple Choice

The next dividend is expected to be $1.80, growth rate is 6%, and the required rate of return is 13%. What is the stock price?

• A) $35.81
• B) $30.83
• C) $25.71
• D) $20.13
• E) $15.51

---

Definitions:

Cost-Benefit Decision

The process of comparing the costs and benefits associated with a decision, project, or investment, to determine its feasibility or profitability.

Customer Profitability

The profit that a company makes from serving a particular customer or client group over time.

Gross Margin

The difference between sales revenue and the cost of goods sold, representing the profitability of selling inventory.

Servicing Cost

The costs associated with maintaining and repairing products or equipment, contributing to the total cost of ownership.