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An Investor Wants to Purchase Shares in a Firm That

Question 72

Multiple Choice

An investor wants to purchase shares in a firm that has no growth opportunities but pays an annual dividend of $2.35.The market rate of return on similar securities is 17.5 percent.What is the maximum price the investor should pay for this stock?


A) $14.52
B) $12.88
C) $13.43
D) $12.76
E) $13.18

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