R&D Technology Corporation Has Just Paid a Dividend of $0

question 44

Multiple Choice

R&D Technology Corporation has just paid a dividend of $0.50 per share. The dividends are expected to grow at 24% per year for the next two years and at 8% per year thereafter. If the required rate of return in the stock is 16% (APR) , calculate the current value of the stock.

• A) $1.11
• B) $7.71
• C) $8.82
• D) None of the above

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