You Wish to Earn a Return of 13% on Each

question 38

Multiple Choice

You wish to earn a return of 13% on each of two stocks, X and Y. Stock X is expected to pay a dividend of $3 in the upcoming year while stock Y is expected to pay a dividend of $4 in the upcoming year. The expected growth rate of dividends for both stocks is 7%. The intrinsic value of stock X

• A) will be greater than the intrinsic value of stock Y.
• B) will be the same as the intrinsic value of stock Y.
• C) will be less than the intrinsic value of stock Y.
• D) will be the same or greater than the intrinsic value of stock Y.
• E) None of the options are correct.

---

Definitions:

Word Processing

The use of computer software to create, edit, and print documents.

Office Administrator

An individual responsible for overseeing the daily operations of an office.

Printing

The process of reproducing text and images, typically with ink on paper using a printing press or a printer.

Monetary Products

typically refers to financial products or instruments that are directly related to money or the management of money, such as currency, loans, and investment vehicles; however, this term is not widely used in formal economic contexts and might be considered non-standard.