Apple has 200 shares outstanding. It earns $2,000 per year and expects to pay all of it as dividends. If the firm expects to maintain this dividend forever, calculate the stock price after the dividend payment. (The required rate of return is 5 percent.) $210 $200 $190 $195
Apple has 200 shares outstanding. It earns $2,000 per year and expects to pay all of it as dividends. If the firm expects to maintain this dividend forever, calculate the stock price after the dividend payment. (The required rate of return is 5 percent.) $210 $200 $190 $195
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
Section: Chapter Questions
Problem 1PS
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
Transcribed Image Text:Apple has 200 shares outstanding. It earns $2,000 per year and
expects to pay all of it as dividends. If the firm expects to maintain
this dividend forever, calculate the stock price after the dividend
payment. (The required rate of return is 5 percent.)
$210
$200
24190
$195
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