A Company's Current Stock Price Is $50

question 46

Multiple Choice

A company's current stock price is $50.00 and its most recent dividend was $2.00 per share. Since analysts estimate the company will have a 5 percent growth rate, what is its expected return?

• A)2.20 percent
• B)5.02 percent
• C)7.00 percent
• D)7.10 percent

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Definitions:

Inducible

A term describing a gene or process that can be activated or increased in response to a specific stimulus.

Ovule

Of seed plants, reproductive structure in which the female gametophyte forms and develops. Matures into a seed after fertilization.

Seed

Embryo sporophyte of a seed plant packaged with nutritive tissue inside a protective coat.

Ovary

An organ in female animals where eggs or ova are produced; in flowering plants, it is part of the pistil where ovules are produced.