Answered: A stock just paid a dividend of $1.50.…

A stock just paid a dividend of $1.50. The required rate of return is 8.5%, and the constant growth rate is 4%. What is the current stock price? a. $36.11 b. $35.15 c. $35.63 d. $34.67 e. $34.19

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter8: Basic Stock Valuation

Section: Chapter Questions

Problem 8P: A stock is trading at $80 per share. The stock is expected to have a yearend dividend of $4 per...

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Question

General Accounting

A stock just paid a dividend of $1.50. The required
rate of return is 8.5%, and the constant growth rate
is 4%.
What is the current stock price?
a. $36.11
b. $35.15
c. $35.63
d. $34.67
e. $34.19

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