USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)

question 164

Multiple Choice

USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Assume that the dividend payout ratio will be 65 percent when the rate on long-term government bonds falls to 8 percent. Because investors are becoming more risk averse, the equity risk premium will rise to 7 percent and investors will require a 15 percent return. The return on equity will be 12 percent.
-Refer to Exhibit 9.1. To what price will the market rise if the earnings expectation is $22.00 per share?

• A) $183.26
• B) $132.41
• C) $198.66
• D) $71.28
• E) $14.30

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Definitions:

Teen Drug Abuse

The use and abuse of drugs by adolescents, often leading to addiction, health risks, and other social and psychological problems.

Adoptive Parent

An individual who has become a parent through the legal process of adopting one or more children.

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The concentration of dopamine, a neurotransmitter associated with the brain's reward and pleasure centers, motor function, and regulation of mood.

Axon

The neuron extension that passes messages through its branches to other neurons or to muscles or glands.