Omega Corp Has an ROE of 15%; Has Just Paid

question 75

Multiple Choice

Omega Corp has an ROE of 15%; has just paid a dividend of $1.55; a pays 0% of its earnings out in dividends,and the appropriate discount rate is 20%; what is the current stock price?

• A) $ 7.75
• B) $ 11.88
• C) $ 35.65
• D) $ 42.78

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Definitions:

Payment to Suppliers

Financial transactions that involve settling debts with vendors who provide goods or services to a business.

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Backlog

Orders that have been received but not delivered to the customer.

Orders Received

The total number of orders that a company gets from its customers within a certain period.