Google Has Just Declared a Dividend of $2

question 88

Multiple Choice

Google has just declared a dividend of $2.12 on its common stock.Dividends are paid annually.Dividends are expected to grow at the rapid pace of 10% for the next 4 years,after which growth is expected to slow to 3% per annum forever.During the rapid growth phase,the required return on this investment will be 20%,and it is expected to drop to 12% when growth slows.What is the current market value of this stock?

• A) $19.73
• B) $23.98
• C) $25.33
• D) $29.43
• E) $74.70

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Definitions:

Nicola Pisano

A prominent Italian sculptor of the 13th century, known for his classical style and significant contributions to Gothic art.

Economic Power

The ability of a person, company, or nation to influence or control economies through wealth, production, or trade.

Political Power

The ability or capacity to influence, control, or manipulate the policies, actions, and affairs of a political entity, such as a country or city.

Berlinghieri's Saint Francis Altarpiece

A 13th-century painting by Bonaventura Berlinghieri, celebrated for its depiction of Saint Francis of Assisi and marking a significant moment in early Italian art.