Assume IBM Just Paid a Dividend of $4

question 38

Multiple Choice

Assume IBM just paid a dividend of $4.50 and expects these dividends to grow at 8% a year. The price of IBM is $100 per share. What is IBM's cost of equity capital?

• A) 3.86%
• B) 8%
• C) 12.22%
• D) 12.86%

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Definitions:

Physical Activity

Any bodily movement produced by skeletal muscles that requires energy expenditure, beneficial for health and wellness.

Hypertension

Abnormally high blood pressure, with either a systolic reading in excess of 160 or a diastolic reading in excess of 105.

Cardiovascular Disease

A range of conditions that affect the heart and blood vessels, leading to problems like heart attacks and strokes.

Long-Distance Runner

An athlete specialized in running distances longer than 3000 meters, typically encompassing events such as marathons.