Diets for You Announced Today That It Will Begin Paying

question 62

Multiple Choice

Diets For You announced today that it will begin paying annual dividends next year.The first dividend will be $0.12 a share.The following dividends will be $0.15,$0.20,$0.50,and $0.75 a share annually for the following 4 years,respectively.After that,dividends are projected to increase by 4 percent per year.How much are you willing to pay to buy one share of this stock today if your desired rate of return is 8.5 percent?

• A)$11.67
• B)$11.94
• C)$12.78
• D)$13.50
• E)$13.86

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Definitions:

Zenefits

A cloud-based software as a service (SaaS) company, which provides human resources services for small and medium-sized businesses, including payroll and benefits management.

Start-ups

New business ventures in their early stages, often characterized by innovation and designed to rapidly develop scalable business models.

Electronic Tendering

The process of conducting the tendering (or bidding) process online, including submission and review of bids, primarily to increase efficiency and reduce costs.

Suppliers

Entities or individuals that provide goods or services to other businesses or consumers, often playing a critical role in supply chains.