A Stock Is Expected to Pay $2

question 64

Multiple Choice

A stock is expected to pay $2.60 per share every year indefinitely and the equity cost of capital for the company is 11%. What price would an investor be expected to pay per share next year?

• A) $5.91
• B) $11.82
• C) $17.73
• D) $23.64

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Definitions:

Attendance

The act of being present at a location or event, often measured to assess participation or interest.

Human Capital

Represents the skills, knowledge, and experience possessed by an individual or population, viewed in terms of their value or cost to an organization or country.

Fishing Fleet

A collection of commercial fishing vessels that operate together to harvest fish and seafood.

Mobile Phones

Portable electronic devices used for communication purposes, including voice calls, text messaging, and internet access.