OwenInc Has a Current Stock Price of $14

question 46

Multiple Choice

OwenInc has a current stock price of $14.50 and is expected to pay a $0.85 dividend in one year.If OwenInc's equity cost of capital is 12%,what price would OwenInc's stock be expected to sell for immediately after it pays the dividend?

• A)$12.18
• B)$13.65
• C)$15.29
• D)$15.39

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Definitions:

Annual Insurance

The total cost of insurance coverage for an entity or individual for a one-year period.

List Price

The advertised or published price of a product or service before any discounts or deductions are applied.

Annual Property Taxes

Taxes assessed on property ownership, levied annually based on the property's assessed value.

Real Estate

Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water.