A Stock Just Paid a Dividend of D0 = $1

question 39

Multiple Choice

A stock just paid a dividend of D0 = $1.50. The required rate of return is rs = 10.1%, and the constant growth rate is g = 4.0%. What is the current stock price?

• A) $23.11
• B) $23.70
• C) $24.31
• D) $24.93
• E) $25.57

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Definitions:

PIRLS

An international study assessing the reading proficiency of fourth-grade students around the globe.

International Test

An examination conducted across various countries intended to assess and compare the abilities or skills of individuals on a global scale.

Science and Math

Academic disciplines focusing on the study of the natural world through observation and experiment, and the study of numbers, quantities, shapes, and their relationships.

Flynn Effect

The observed large and systematic increase in intelligence test scores measured in many parts of the world over the 20th century.