Charlie Company Is Expected to Grow at an Annual Rate

question 144

Multiple Choice

Charlie Company is expected to grow at an annual rate of 6% indefinitely. The return on similar stocks is currently 11%. Charlie's board of directors declared a dividend of $1.85 yesterday. What should a share of Charlie Company sell for?

• A)$39.22
• B)$37.00
• C)$16.82
• D)$17.83

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