A Stock Has a Current Dividend of $0

question 50

Multiple Choice

A stock has a current dividend of $0.32 with a growth rate of 8% annually. Assuming a 10% annual discount rate, what should the price of the stock be one year from today?

• A)$18.66
• B)$16.00
• C)$17.28
• D)$3.20

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Definitions:

General Ledger

The primary accounting record of a company that uses double-entry bookkeeping, containing all the financial accounts and transactions.

Reference Column

An additional column in financial documents used to include explanatory notes or cross-references.

Manual Accounting Systems

Traditional methods of maintaining financial records and calculations by hand or using basic software, without automated processes.

Electronic Systems

Integrated assemblies of electronic components and circuits designed to perform a specific function or a range of functions.