How Much Would You Pay for a Common Share Today

question 90

Multiple Choice

How much would you pay for a common share today, if you expect it will pay a dividend of $2.50 each year and will sell for $58 one year from now? Assume your required rate of return on this share is 13.0%.

• A)$60.50
• B)$55.50
• C)$53.54
• D)$49.59

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Definitions:

Least Common

The smallest or rarest occurrence or item in a given set or category.

Anti-D Serum

An immunoglobulin given to prevent Rh incompatibility reactions, often used in pregnancy.

Rh Antigens

Proteins present on the surface of red blood cells that determine an individual's Rh blood group, critical in blood transfusion compatibility.

Agglutinogens

Antigens on the surfaces of red blood cells that determine blood types and can cause agglutination.