Laurentide Union Bank Is Expected Just Paid a Dividend of $4.20

question 42

Multiple Choice

Laurentide Union Bank is expected just paid a dividend of $4.20 per common share.Laurentide Union Bank expects dividends to grow at a rate of 5% for the foreseeable.If the current market price for a share of Laurentide Union Bank is $40, what is the cost of equity?

• A)10.50%
• B)11.02%
• C)15.50%
• D)16.02%

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Definitions:

Journal Article

A scholarly work published in an academic journal, contributing to a particular field of study.

External Validity

Refers to the extent to which the results of a study can be generalized to other settings, people, times, and measures.

Manipulation Check

A process in experiments to ensure that the manipulation of variables has the intended effect on participants.

Factorial Study

A research design used to assess the influence and interaction effects of two or more independent variables on one or more dependent variables.