What Should Be the Price for a Common Stock Paying

question 19

Multiple Choice

What should be the price for a common stock paying $3.50 annually in dividends if the growth rate is zero and the discount rate is 8 percent?

• A)$22.86
• B)$28.00
• C)$42.00
• D)$43.75

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Definitions:

Negentropy

The process of system organization that increases order and reduces entropy, essentially referring to structures becoming more ordered.

Stressors

External forces or situations that cause stress, potentially impacting an individual's physical and psychological well-being.

Intrapersonal Stressors

Internal conflicts, thoughts, or feelings that act as sources of stress within an individual, affecting their psychological state.

Spiritual Stressors

Factors or situations that challenge an individual's spiritual beliefs or practices, potentially causing stress or discomfort in the realm of spirituality.