Dee's Made Two Announcements Concerning Its Common Stock Today

Multiple Choice

Dee's made two announcements concerning its common stock today. First, the company announced that the next annual dividend will be $1.58 a share. Secondly, all dividends after that will decrease by 1.15 percent annually. What is the value of this stock at a discount rate of 15.5 percent?

A) $9.49
B) $10.10
C) $9.82
D) $10.51
E) $11.01