Lucy is considering investing in a particular stock with a dividend that has grown at a constant rate for some time. The observed rate is about 4 %. The current expected rate of return on this kind of stock is 14 %, and the last paid dividend (DO) was $2.00. What is the value of a share of this stock? (a) $21.60 (b) $20.80 (c) $19.80 (d) $20.00.

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Q: What is different between residual dividend, dividend policy and share repurchase ?

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Q: differnce between tradional and mordern dividend policy

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Q: What is the cost of equity in the levered company

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Q: What is the clientele effect, and how does it affect dividend policy irrelevance

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