What Is the Required Return for a Stock That Has

question 70

Multiple Choice

What is the required return for a stock that has a 6% constant growth rate, a price of $25, an expected dividend of $2, and a P/E ratio of 10?

• A)5%
• B)10%
• C)14%
• D)22% $25 = 2/(r - .06)

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Definitions:

Nervous System

The network of nerve cells and fibers that transmits nerve impulses between parts of the body, enabling communication and response to the environment.

Voluntary Eye Movements

Eye movements that are consciously controlled, allowing for the visual scanning of the environment.

Motion Parallax

A depth cue that involves the relative movement of objects as the observer moves, allowing for the perception of three-dimensional depth.

Target

A predetermined goal or objective towards which efforts are directed.