A Firm Is Expected to Pay a Dividend of $2

question 39

Multiple Choice

A firm is expected to pay a dividend of $2.00 next year and $3.75 the following year. Financial analysts believe the stock will be at their price target of $125.00 in two years. Compute the value of this stock with a required rate of return of 15 percent.

• A) $78.34
• B) $81.05
• C) $87.13
• D) $99.09

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Definitions:

Mineral Ions

Charged particles from minerals that plants absorb from the soil, which are crucial for their growth and development.

Sieve Elements

Specialized cells located in the phloem of vascular plants, responsible for assisting in the movement of sugars and nutrients.

Vessel Members

Specialized cells that form part of the xylem vessels in plants, involved in the transport of water and nutrients.

Lignin

Material that strengthens cell walls of vascular plants.