Your Company Paid a Dividend of $2

question 2

Multiple Choice

Your company paid a dividend of $2.00 last year.The growth rate is expected to be 4 percent for 1 year, 5 percent the next year, then 6 percent for the following year, and then the growth rate is expected to be a constant 7 percent thereafter.The required rate of return on equity (ks) is 10 percent.What is the current price of the common stock?

• A)$53.45
• B)$60.98
• C)$64.49
• D)$67.47
• E)$69.21

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Definitions:

Dendrites

Branch-like extensions of neurons that receive signals from other nerve cells and conduct them toward the cell body.

Cerebrum

The largest part of the brain, responsible for voluntary activities, cognition, memory, and learning; it is divided into two hemispheres.

Thalamus

A brain structure that acts as a relay station for sensory and motor signal inputs to the cerebral cortex, except for the sense of smell.

Limbic System

A complex system of nerves and networks in the brain, involved in emotions such as fear and pleasure, as well as instincts and mood.