Analysts Announced Estimated Dividends Per Share of $2 for the Coming

question 69

Multiple Choice

Analysts announced estimated dividends per share of $2 for the coming year for Toronto Skates Ltd.They expect dividends to grow at 4% forever.If the required rate of return is 7%, then the current share price is:

• A)$50.00
• B)$28.57
• C)$87.50
• D)$66.67

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Definitions:

Small Firms

Businesses with a relatively small number of employees or low volume of sales compared to larger industry players.

Social Security Payments

Government-provided payments to eligible individuals, such as retirees or disabled persons, financed through payroll taxes.