A firm paid an annual dividend of $1.37 a share last month. Today, the company announced that future dividends will be increasing by 2.80% annually. If you require a return of 11.60%, how much are you willing to pay to purchase one share of this stock today?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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A firm paid an annual dividend of $1.37 a share
last month. Today, the company announced
that future dividends will be increasing by
2.80% annually. If you require a return of
11.60%, how much are you willing to pay to
purchase one share of this stock today?
Transcribed Image Text:A firm paid an annual dividend of $1.37 a share last month. Today, the company announced that future dividends will be increasing by 2.80% annually. If you require a return of 11.60%, how much are you willing to pay to purchase one share of this stock today?
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