R&D Technology Corporation Just Paid a Dividend of $0

question 20

Multiple Choice

R&D Technology Corporation just paid a dividend of $0.50 per share.Analysts expect its dividend to grow at 24% per year for the next two years and then 8% per year thereafter.If the required rate of return in the stock is 16%,calculate the current value of the stock.

• A)$1.11
• B)$7.71
• C)$8.82
• D)$10.38

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