If the Dividend Yield for Year One Is Expected to Be

question 88

Multiple Choice

If the dividend yield for year one is expected to be 5% based on the current price of $25, what will the year four dividend be if dividends grow at a constant 6%?

• A)$1.33
• B)$1.49
• C)$1.58
• D)$1.67

---

Definitions:

Output Markets

Markets in which goods and services are exchanged.

Product Market

The marketplace where final goods or services are offered to consumers, businesses, and the public.

Output Market

The output market is the marketplace in which goods and services produced by firms are sold or exchanged, contrasting with input markets where firms buy resources needed for production.

Labor

The physical and mental effort used to produce goods and services.