Albright Motors Is Expected to Pay a Year-End Dividend of $3.00

question 7

Multiple Choice

Albright Motors is expected to pay a year-end dividend of $3.00 a share (D1 = $3.00) . The stock currently sells for $30 a share. The required (and expected) rate of return on the stock is 16 percent. If the dividend is expected to grow at a constant rate, g, what is g?

• A) 13.00%
• B) 10.05%
• C) 6.00%
• D) 5.33%
• E) 7.00%

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Definitions:

Peristaltic Action

The wave-like muscle contractions that move food through the digestive tract.

Ureters

Tubes that carry urine from the kidneys to the bladder.

Peritubular Capillaries

Tiny blood vessels that surround the tubules in the kidneys, where substances are exchanged between the blood and the tubular fluid.

Tubules

Small tubes within structures of the body, such as the kidneys or plants, through which fluids or other substances move.