The Last Dividend on GTE Stock Was $4, and the Expected

question 126

Multiple Choice

The last dividend on GTE stock was $4, and the expected growth rate is 10%. If you require a rate of return of 20%, what is the highest price you should be willing to pay for GTE stock?

• A) $40
• B) $42.50
• C) $44
• D) none of the above

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Definitions:

Consumer Decision

The process by which a consumer selects a product or service among multiple choices, influenced by factors like personal preferences, price, quality, and marketing.

Purchase Affected

Instances where the decision to buy a product or service is influenced by external or internal factors.

Incumbent Politicians

Refers to officials who currently hold a position or office in a governmental body.

Negative Attitude

A tendency to view situations, objects, or people in an unfavorable or pessimistic light, which can influence decision-making and behavior patterns.