Show Boat Dinner Theatres Has Paid Annual Dividends of $0

question 74

Multiple Choice

Show Boat Dinner Theatres has paid annual dividends of $0.32,$0.52,and $0.60 a share over the past three years,respectively.The company now predicts that it will maintain a constant dividend since its business has leveled off and sales are expected to remain relatively flat.Given the lack of future growth,you will only buy this stock if you can earn at least a 19 percent rate of return.What is the maximum amount you are willing to pay for one share of this stock today?

• A)$2.43
• B)$3.16
• C)$4.43
• D)$4.69
• E)$4.82

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Definitions:

Centimeters

A measurement within the metric system that is equivalent to 0.01 meters.

Mass

A measure of the amount of matter in an object, typically measured in kilograms or grams.

Weight

The force exerted on an object due to gravity, typically measured in newtons or pounds.

Physical Change

A transformation where the matter's form is modified without converting one substance into a different one.