World-Tour Co

question 53

Multiple Choice

World-Tour Co.has just now paid a dividend of $2.83 per share (D₀) ; its dividends are expected to grow at a constant rate of 6% per year forever.If the required rate of return on the stock is 16%,what is the current value of the stock,after paying the dividend?

• A)$70
• B)$56
• C)$30
• D)$48

---

Definitions:

Collectivist Culture

A culture that emphasizes the needs and goals of the group as a whole over the needs and wishes of each individual.

Equality

The state of being equal, especially in status, rights, and opportunities.

Respect for Elders

A cultural and moral value emphasizing reverence and honor for older people.

Openness

One of the five major dimensions of personality, characterized by an appreciation for art, emotion, adventure, unusual ideas, imagination, curiosity, and variety of experience.