Winifred, Inc

question 79

Multiple Choice

Winifred, Inc. paid $1.64 as an annual dividend per share last year. The company is expected to increase their annual dividends by 3% each year. How much should you pay to purchase one share of this stock if you require a 9% rate of return on this investment?

• A) $27.33
• B) $18.22
• C) $18.77
• D) $28.15

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Definitions:

Gross Profit Rate

The ratio of gross profit to net sales, indicating the efficiency of a company in managing its production and labor costs.

Intra-entity Transfer

A transaction occurring between divisions or units within the same legal entity.

Noncontrolling Interest

An ownership interest in a corporation that is less than 50%, not allowing for control over the company's operations.

Depreciable Asset

A tangible or intangible asset used in operations that can be depreciated over its useful life due to wear and tear, deterioration, or obsolescence.