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?

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?
Transcribed Image Text: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?
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