What Price Would You Pay Today for a Stock If

question 34

Multiple Choice

What price would you pay today for a stock if you require a rate of return of 13%,the dividend growth rate is 3.6%,and the firm recently paid an annual dividend of $2.50?

• A) $27.55
• B) $30.28
• C) $26.60
• D) $31.37

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Definitions:

Single-blind Study

A study design where the participants do not know which group (experimental or control) they are in to prevent bias, but the researchers do.

Descriptive Research

A research method aimed at describing characteristics of a population or phenomenon being studied without influencing those characteristics.

Representative Sample

A smaller group taken from a larger population that truly represents all members of that population.

Scientific American

A popular science magazine that features articles on various scientific topics for a general audience.