If a Stock's Present Dividend Is $2

question 140

True/False

If a stock's present dividend is $2.00 and it is expected to grow at a constant annual rate of 6% with a market- return of 12%, the selling price of the stock today is $33.33.

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Definitions:

Motion

The change in position of an object with respect to time and its reference point.

Potential Energy

The energy stored by an object due to its position in a force field or its condition.

Crest

The peak or highest point of something, often used to describe the comb or tuft of feathers on the head of birds or other features like waves or helmets.

Hill

A naturally raised area of land, smaller than a mountain, with a rounded top.