Gremlin Industries Will Pay a Dividend of $1

question 115

Multiple Choice

Gremlin Industries will pay a dividend of $1.80 per share at the end of this year.It is expected that this dividend will grow by 4% per year each year in the future.The current price of Gremlin's stock is $22.40 per share.What is Gremlin's equity cost of capital?

• A)11%
• B)12%
• C)14%
• D)16%
• E)18%

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Definitions:

Secure Attachment Style

A pattern of bonding where individuals are comfortable with intimacy and independence, showing trust in relationships.

Anxiety

A sensation of apprehension, tension, or discomfort, often related to an upcoming occurrence or a situation whose result is not yet determined.

Avoidance

A strategy or behavior aimed at preventing or eliminating encounters with specific stimuli, situations, or activities believed to be unpleasant.

Maslow

Refers to Abraham Maslow, a psychologist best known for creating Maslow's hierarchy of needs, a theory in psychology that prioritizes human needs from the most fundamental to higher levels of self-actualization.