The Sisyphean Company Is Currently Trading for $25

question 26

Multiple Choice

The Sisyphean Company is currently trading for $25.00 per share. The company is expected to pay a $2.50 dividend at the end of the year and its equity cost of capital is 14%. If the dividend payout rate is expected to remain constant, then the expected growth rate in the Sisyphean Company's earnings is closest to:

• A)6%
• B)8%
• C)4%
• D)2%

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