General accounting Innova Tech Corp. just announced its next annual dividend will be$2.75 per share, and all future dividends are expected to grow by4% annually. If the stock is currently trading at $35 per share,what is the market rate of return?

CalculationNext Year's Dividend: $2.75Current Stock Price: $35Dividend Growth Rate: 4% or 0.04…

Answered: Innova Tech Corp. just announced its…

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 3P

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Innova Tech Corp. just announced its next annual dividend will be $2.75 per share, and all future dividends are expected to grow by 4% annually. If the stock is currently trading at $35 per share, what is the market rate of return?