Spacefood Products Will Pay a Dividend of $2

question 46

Multiple Choice

Spacefood Products will pay a dividend of $2.40 per share this year. It is expected that this dividend will grow by 5% per year each year in the future. What will be the current value of a single share of Spacefood's stock if the firm's equity cost of capital is 12%?

• A) $24.00
• B) $22.29
• C) $30.86
• D) $34.29

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