You Now Own 84 Shares of XYZ Stock, Which Is

question 7

Multiple Choice

You now own 84 shares of XYZ stock, which is selling for $40 each, 4 of which you just received from the XYZ corporation.XYZ has declared a:

• A)Stock dividend of 5%
• B)Cash dividend of $4
• C)Stock dividend of 4%
• D)Cash dividend of $160

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Definitions:

Subjective Approaches

Methods or considerations based on personal opinions, interpretations, feelings, or judgments rather than objective facts or analysis.

Pure Play Approaches

Investment strategies that focus on companies that specialize in a particular product or service, excluding diversified or conglomerate firms.

Cost of Capital

The rate of return required by a capital provider, whether debt or equity, to make an investment in a project, asset, or firm.

Risk Premium

The additional return expected by an investor for holding a risky asset instead of a risk-free asset.