ABC Corp. just paid a dividend of $1.55 per share and plans to maintain a constant 3.2% dividend growth rate indefinitely. Today's stock price is $28.17. What is the dividend yield and the required return on this stock? A) Dividend yield is 5.68%; required return is 8.88%. B) Dividend yield is 5.50%; required return is 8.70%. C) Dividend yield is 3.20%; required return is 6.40%. D) Dividend yield is 3.20%; required return is 8.88%.
ABC Corp. just paid a dividend of $1.55 per share and plans to maintain a constant 3.2% dividend growth rate indefinitely. Today's stock price is $28.17. What is the dividend yield and the required return on this stock? A) Dividend yield is 5.68%; required return is 8.88%. B) Dividend yield is 5.50%; required return is 8.70%. C) Dividend yield is 3.20%; required return is 6.40%. D) Dividend yield is 3.20%; required return is 8.88%.
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Transcribed Image Text:ABC Corp. just paid a dividend of $1.55 per share and plans to maintain a constant 3.2%
dividend growth rate indefinitely. Today's stock price is $28.17. What is the dividend
yield and the required return on this stock?
A) Dividend yield is 5.68%; required return is 8.88%.
B) Dividend yield is 5.50%; required return is 8.70%.
C) Dividend yield is 3.20%; required return is 6.40%.
D) Dividend yield is 3.20%; required return is 8.88%.
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