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What was the estimated annual required return for Excellence Inc.'s stock?

What was the estimated annual required return for Excellence Inc.'s stock?

Essentials Of Investments
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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Please copy and paste data from text area below. Selected delimiter: Tab Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Dividend 0.85 0.96 1.01 1.14 1.20 1.26 1.42 1.49 1.68 1.90
Transcribed Image Text:Please copy and paste data from text area below. Selected delimiter: Tab Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Dividend 0.85 0.96 1.01 1.14 1.20 1.26 1.42 1.49 1.68 1.90
Excellence Inc.'s annual dividends are indicated below. Find the required rate of return for this stock, assuming the future dividend growth rate will remain the same and the company has an infinite horizon. Assume the January 1, 2011 price of the stock was $46.00. What was the required return for Excellence Inc.'s stock? Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Dividend $0.85 $0.96 $1.01 $1.14 $1.20 $1.26 $1.42 $1.49 $1.68 $1.90 What was the estimated annual required return for Excellence Inc.'s stock? % (Round to two decimal places.)
Transcribed Image Text:Excellence Inc.'s annual dividends are indicated below. Find the required rate of return for this stock, assuming the future dividend growth rate will remain the same and the company has an infinite horizon. Assume the January 1, 2011 price of the stock was $46.00. What was the required return for Excellence Inc.'s stock? Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Dividend $0.85 $0.96 $1.01 $1.14 $1.20 $1.26 $1.42 $1.49 $1.68 $1.90 What was the estimated annual required return for Excellence Inc.'s stock? % (Round to two decimal places.)
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