(Solution) If The Dividend In Year 0 Is $1.20 And The Growth Rate Is 3%, Then The Dividend In Year 7 Is Equal To:20 X (1.20 X (1.20 X (1.20 X (1. | Snapessays.com


(Solution) If the dividend in year 0 is $1.20 and the growth rate is 3%, then the dividend in Year 7 is equal to:20 X (1.20 X (1.20 X (1.20 X (1.


1. If the dividend in year 0 is $1.20 and the growth rate is 3%, then the dividend in Year 7 is equal to:

 

 

a. $1.20 X (1.03)5.

 

b. $1.20 X (1.03)6.

 

c. $1.20 X (1.03)7.

 

d. $1.20 X (1.03)8.

 

 

2. You observe a stock price of $18.75. You expect a dividend growth rate of 5% and the next expected dividend payment is $1.50. What is the required return?:

 

 

a. 5.0%

 

b. 13.0%

 

c. 13.4%

 

d. 15.2%

 

 

3. A company is expected to pay their first annual dividend 3 years from now. That payment will be $1.50 a share. Starting in Year 4, the company will increase the dividend by 5% per year. The required return from common shareholders is 15%. What is the estimated value of this stock today?

 

 

a. $11.34

 

b. $13.04

 

c. $15.28

 

d. $16.50

 


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This question was answered on: May 23, 2022

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