Quality Home Made Ice Cream Has Plans to Pay Decreasing

question 57

Multiple Choice

Quality Home Made Ice Cream has plans to pay decreasing annual dividends of $1.60, $1.50, and $1.35 over the next three years, respectively. After that, the firm will increase the dividend by 5 percent each year. What is the value of this stock today at a discount rate of 11 percent?

• A)$19.26
• B)$19.54
• C)$19.69
• D)$19.93
• E)$20.92

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