Keong Is Considering an Investment in Leong's Bar & Grille

question 10

Multiple Choice

Keong is considering an investment in Leong's Bar & Grille Corporation. Keong is planning to buy the stock today, hold it for 2 years, and then expects to sell the stock for $30 at the end of 2 years. Keong expects the first dividend to be $1.00 and the second dividend to be $1.30. If Keong requires a 15% rate of return, what is the value of Leong's Bar & Grille common stock to Keong today?

• A)$21.58
• B)$23.55
• C)$24.54
• D)$23.67

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Definitions:

Basic Psychological Needs

Fundamental needs that include competence, autonomy, and relatedness, which are essential for psychological health and well-being.

Autonomy

The capacity to make an informed, uncoerced decision independently, often related to personal or organizational freedom.

Autonomy Support

A management or teaching style that nurtures self-initiation and emphasizes the importance of personal choice, freedom, and volition in carrying out tasks.

Personal Initiative

An individual's action that is anticipatory, self-starting, and persistent in overcoming barriers and implementing change or innovation.