A Firm Is Expected to Pay a Dividend of $3

question 91

Multiple Choice

A firm is expected to pay a dividend of $3.00 next year and $3.21 the following year. Financial analysts believe the stock will be at their target price of $80.00 in two years. Compute the value of this stock with a required return of 13 percent.

• A) $50.00
• B) $67.52
• C) $67.82
• D) $86.21

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Definitions:

Employed Category

A classification used in labor statistics that includes individuals who are currently working for pay or profit, or as unpaid workers in a family business.

Part-time Workers

Individuals employed in positions that require fewer hours than the standard for full-time employment, typically less than 35-40 hours a week.

Full-time Workers

Individuals who are employed in jobs that typically require a minimum number of hours worked per week, often considered to be 35-40 hours.

Adult Population

Individuals within a society who are considered adults, usually based on age, for purposes of labor market analysis and demographic studies.