Use the Following Information to Answer the Question(s) Below

question 66

Multiple Choice

Use the following information to answer the question(s) below.
Nielson Motors has a share price of $50.00. Its dividend was $2.50, and you expect Nielson Motors to raise its dividend by approximately 6% per year in perpetuity.
-If Nielson's equity cost of capital is 13%,then Nielson's expected share price is closest to:

• A) $19.23
• B) $35.71
• C) $41.67
• D) $50.00

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