A Stock Is Expected to Pay a Dividend of $0

question 36

Multiple Choice

A stock is expected to pay a dividend of $0.75 at the end of the year.The required rate of return is r_s = 10.5%, and the expected constant growth rate is g = 6.4%.What is the stock's current price?

• A) $17.39
• B) $17.84
• C) $18.29
• D) $18.75
• E) $19.22

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Definitions:

Resistance

In an electrical context, it's the opposition to the flow of electric current; in a broader sense, it could refer to the capacity to withstand something or to not be affected.

Desktop Printers

Compact printers designed for personal or small office use, capable of printing documents, photos, and other materials from desktop or laptop computers.

MST

In computational science, refers to Minimum Spanning Tree, a subset of edges in a weighted graph that connects all vertices with the minimal total edge weight.

MSE

Stands for Mean Squared Error, a measure used to evaluate the difference between the predicted and actual values in statistics and machine learning.