Fools Gold Mining Company Is Expected to Pay a Dividend

question 73

Multiple Choice

Fools Gold Mining Company is expected to pay a dividend of $8 in the upcoming year. Dividends are expected to decline at the rate of 2% per year. The risk-free rate of return is 6%, and the expected return on the market portfolio is 14%. The stock of Fools Gold Mining Company has a beta of 0.25. The return you should require on the stock is

• A) 2%.
• B) 4%.
• C) 6%.
• D) 8%.

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Definitions:

Deploying Quality

The process of implementing and maintaining a level of excellence in products, services, and processes within an organization.

Total Costs

The sum of all expenses incurred in the production of goods or services, including fixed and variable costs.

Product Cost

The total expense incurred in bringing a product to market, including raw materials, labor, and overhead.

Quality Costs

The total amount of costs associated with ensuring the quality of a product or service, including prevention, appraisal, and failure costs.