Multiple Choice
NU YU announced today that it will begin paying annual dividends.The first dividend will be paid next year in the amount of €.25 a share.The following dividends will be €.40, €.60, and €.75 a share annually for the following three years, respectively.After that, dividends are projected to increase by 3.5% per year.How much are you willing to pay to buy one share of this equity if your desired rate of return is 12%?
A) €1.45
B) €5.80
C) €7.25
D) €9.06
E) €10.58
Correct Answer:
Verified
Correct Answer:
Verified
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