NoGrowth Industries Presently Pays an Annual Dividend of $1

question 58

Multiple Choice

NoGrowth industries presently pays an annual dividend of $1.50 per share and it is expected that these dividend payments will continue indefinitely.If NoGrowth's equity cost of capital is 12%,then the value of a share of NoGrowth's stock is closest to:

• A)$10.00.
• B)$15.00.
• C)$14.00.
• D)$12.50.

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Definitions:

Plant Nursery

A specialized facility where plants are propagated, grown to a desired age, and then sold for planting elsewhere.

Liable

Legally responsible for one's actions or obligations, often in the context of paying damages or fulfilling a contractual agreement.

Durable Power of Attorney

A legal document granting someone the authority to act on another's behalf in legal and financial matters, which remains effective even if the grantor becomes incapacitated.

Authority

refers to the lawful right or power to make decisions, give orders, or enforce laws.