Quality Home Made Ice Cream Has Plans to Pay Decreasing

question 95

Multiple Choice

Quality Home Made Ice Cream has plans to pay decreasing annual dividends of $1.50,$1.25,and $1.00 over the next three years,respectively.After that,the firm will increase the dividend by 4 percent each year.What is the value of this stock today at a discount rate of 9 percent?

• A)$19.26
• B)$19.54
• C)$19.69
• D)$19.93
• E)$20.48

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Definitions:

Pork-barrel Projects

Government projects or appropriations yielding benefits to a narrow constituency in return for political support, often criticized as wasteful public spending.

Federal Government

The central government of a federation, possessing authority over national issues, and comprising of executive, legislative, and judicial branches.

Representative Democracy

A type of democracy wherein citizens elect officials to represent their interests and make legislative decisions on their behalf, rather than making those decisions directly.

User Charge

A fee paid by the users of a service or facility, directly relating to the extent of their use.