Data for a Share of Common Stock of ABC Company

question 183

Multiple Choice

Data for a share of common stock of ABC Company appear below:
Dividend: 2005 actual $ 1.000
2006 actual 1.100
2007 actual 1.210
2008 expected 1.331
Current market price per share: $20.000
Assuming the dividend pattern above will continue in the future and also assuming that it is the first of January,2008,the estimated current return for the stock is

• A)6.67%.
• B)10.00%.
• C)5.05%.
• D)16.67%.