The Expected Return on Northeast Corporation's Stock Is 14

question 22

Multiple Choice

The expected return on Northeast Corporation's stock is 14%.The stock's dividend is expected to grow at a constant rate of 8%,and it currently sells for $50 a share.Which of the following statements is correct?

• A)The stock's dividend yield is 7%.
• B)The stock's dividend yield is 8%.
• C)The current dividend per share is $4.00.
• D)The stock price is expected to be $54 a share 1 year from now.

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Definitions:

Monetary Policy

Actions taken by a central bank to control the money supply and interest rates in an economy.

Federal Government Budget

A financial statement presenting the government's proposed revenues and spending for a financial year.

Biennial Budget

A budget planned and set for a two-year period, often employed by government entities to manage expenses and revenues more efficiently.

Discretionary Fiscal Policy

Government policy that involves adjusting its spending levels and tax rates to monitor and influence a nation's economy.