Etling Inc

question 33

Multiple Choice

Etling Inc.'s dividend is expected to grow at 6% for the next two years and then at 3% forever. If the current dividend is $3 and the required return is 16%, what is the price of the stock?

• A) $25.10
• B) $25.82
• C) $26.15
• D) $27.58
• E) $29.45

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Definitions:

Assumption

Something that is accepted as true or as certain to happen, without proof.

Forms of Communication

Various methods or modalities used to convey messages and information, including verbal, non-verbal, written, and digital.

Benefit

An advantage or profit gained from something.

Passive Activity

An activity in which the person involved does not actively participate or exert control, often used in reference to certain types of income for tax purposes.