You Are Considering the Purchase of XYZ Company's Ordinary Shares

question 112

Multiple Choice

You are considering the purchase of XYZ Company's ordinary shares which will pay a $1.00 per share dividend one year from the date of purchase.The dividend is expected to grow at the rate of 4% per year.If the appropriate discount rate for this investment is 14%,what is the price of one share of XYZ?

• A)$7.14
• B)$10.00
• C)$25.00
• D)Cannot be determined without maturity date

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Definitions:

Flashbulb Memory

Highly detailed, exceptionally vivid 'snapshot' of the moment and circumstances in which a piece of surprising and consequential (or emotionally arousing) news was heard.

Visual Stimuli

Objects or events that are seen and stimulate the visual senses, leading to a response or recognition by the viewer.

Detailed Memories

Highly vivid and specific recollections of past events, often with a wealth of sensory and emotional details.

Traumatic Events

Incidents that provoke psychological, emotional, or physical harm or distress in an individual.