You Want to Purchase Some Shares of Green World Stock

Multiple Choice

You want to purchase some shares of Green World stock but need a 15 percent rate of return to compensate for the perceived risk of such ownership.What is the maximum you are willing to spend per share to buy this stock if the company pays a constant $0.90 annual dividend per share?

A) $5.40
B) $6.00
C) $6.90
D) $7.20
E) $7.80