Assume IBM Just Paid a Dividend of $4

question 38

Multiple Choice

Assume IBM just paid a dividend of $4.50 and expects these dividends to grow at 8% a year. The price of IBM is $100 per share. What is IBM's cost of equity capital?

• A) 3.86%
• B) 8%
• C) 12.22%
• D) 12.86%

---

Definitions:

Diastolic Blood Pressure

The pressure in the arteries when the heart rests between beats.

High Dosage

An amount or concentration of a substance or medication that exceeds the commonly prescribed or standard level.

Experimental Drug

A medication or therapy under investigation in clinical trials but not yet approved by regulatory authorities for general use.

Intelligence Tests

Standardized assessments designed to measure human intelligence and cognitive abilities.