The Francis Company Is Expected to Pay a Dividend of D1

question 2

Multiple Choice

The Francis Company is expected to pay a dividend of D1 = $1.25 per share at the end of the year, and that dividend is expected to grow at a constant rate of 6.00% per year in the future. The company's beta is 1.15, the market risk premium is 5.50%, and the risk-free rate is 4.00%. What is the company's current stock price?

• A) $28.90
• B) $29.62
• C) $30.36
• D) $31.12
• E) $31.90

---

Definitions:

Surgical Asepsis

Techniques used during surgery to prevent contamination by microorganisms, ensuring a sterile environment.

Pathogenic Organisms

Microorganisms that cause diseases in their hosts.

Aseptic Technique

A set of specific practices and procedures performed under carefully controlled conditions with the goal of minimizing contamination by pathogens.

Serrations

Jagged or toothlike edges on objects such as knives or saw blades, enhancing cutting efficiency.