Luther Industries Has a Dividend Yield of 4

question 118

Multiple Choice

Luther Industries has a dividend yield of 4.5% and and a cost of equity capital of 12%.Luther Industries' dividends are expected to grow at a constant rate indefinitely.The growth rate of Luther's dividends is closest to:

• A)7.5%
• B)5.5%
• C)16.5%
• D)12%
• E)4.5%

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Definitions:

Cost Leadership

A competitive advantage strategy by minimizing operational costs to offer products or services at the lowest price in the market.

Manufacturing Facilities

Locations where products are produced or assembled.

Capacity Allocation

The process of assigning available resources or space to various operations, tasks, or productions within an organization.

Facility Role

The defined responsibilities and functions of a facility within an organization or network, such as manufacturing, storage, or distribution.