What Should Be the Price of a Share If It

question 98

Multiple Choice

What should be the price of a share if it paid $1.75 in dividends in the last financial year,its dividend growth rate is 4%,and the required rate of return is 11%?

• A) $25.00
• B) $26.00
• C) $30.28
• D) $43.75

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Definitions:

Excreted

The process by which waste products of metabolism are eliminated from an organism, usually through urine, feces, sweat, or exhalation.

Acetaminophen

A medication used to reduce fever and relieve pain.

Overdose

The ingestion or application of a drug or medicine in quantities greater than are recommended or generally practiced, often resulting in a toxic effect.

Interaction

The mutual or reciprocal action or influence between entities, substances, or people.