What Should Be the Price of a Share That Constantly

question 89

Multiple Choice

What should be the price of a share that constantly pays $2.50 annually in dividends,if the growth rate is zero and the required rate of return is 8% per annum?

• A) $22.86
• B) $28.00
• C) $31.25
• D) $33.75

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Definitions:

Systematic Desensitization Therapy

A behavioral therapy technique designed to reduce phobic or anxiety responses through gradual exposure to the feared object or situation, combined with relaxation exercises.

Feared Stimuli

External objects or situations that provoke a strong fear response due to anxiety, phobias, or traumatic experiences.

In Vivo Exposure

A behavioral therapy technique that involves exposing the patient to the actual anxiety-producing stimuli, rather than imagining the scenario, to help overcome fears or undesirable behaviors.

Operant Conditioning

A method of learning that employs rewards and punishments for behavior, emphasizing the idea that behaviors followed by positive outcomes are more likely to recur.