What Constant Growth Rate in Dividends Is Expected for a Stock

question 85

Multiple Choice

What constant growth rate in dividends is expected for a stock valued at $32.00 if next year's dividend is forecast at $2.00 and the appropriate discount rate is 13 percent?

• A)5.00 percent
• B)6.25 percent
• C)6.75 percent
• D)15.38 percent $32.00 =

---

Definitions:

Lead Paint

Paint that contains lead, a toxic metal, which can pose health risks when ingested or inhaled, especially to children.

Banned

Prohibited by law or formal decree; not allowed to be used, sold, or participated in.

Fetal Alcohol Syndrome

A developmental disorder that affects children whose mothers consumed alcohol during pregnancy. Its effects include a range of psychological problems and physical abnormalities.

Facial Abnormality

A condition where the structure of the face deviates from the norm significantly due to genetic, developmental, or environmental factors.