What Is the Expected Constant-Growth Rate of Dividends for a Stock

question 84

Multiple Choice

What is the expected constant-growth rate of dividends for a stock currently priced at $50,that just paid a dividend of $4,and has a required return of 18%?

• A) 3.41%
• B) 5.50%
• C) 9.26%
• D) 12.5%

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Definitions:

Stimulus-Value-Role

A theory in social psychology that suggests relationships progress in three stages: initial attraction based on stimuli, alignment of values, and compatibility of roles.

Conspicuous Attributes

Features of an object or individual that stand out and are easily noticed, often used in the context of consumer behavior to describe visible signs of social status.

Collectivistic Cultures

Societies or cultures that emphasize the needs and goals of the group over the desires and needs of the individual.

Individualistic Cultures

Societies that emphasize personal achievements, independence, and the rights of the individual over group goals.