Please Provide Correct answer of this question Assume Coleco pays an annual dividend of 1.53 and has ashare price of 37.79. It announces that its annual dividendwill increase to 1.75. If its dividend yield stays the same, whatshould be its new share price?

1. First, let's calculate the current dividend yield: Dividend Yield = Annual Dividend / Share…

Answered: Assume Coleco pays an annual dividend…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter7: Common Stock: Characteristics, Valuation, And Issuance

Section: Chapter Questions

Problem 7P

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Assume Coleco pays an annual dividend of 1.53 and has a share price of 37.79. It announces that its annual dividend will increase to 1.75. If its dividend yield stays the same, what should be its new share price?