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How Much Should You Pay for a Share of Stock

Question 27

Multiple Choice

How much should you pay for a share of stock that offers a constant-growth rate of 10%,requires a 16% rate of return,and is expected to sell for $50 one year from now?


A) $42.00
B) $45.00
C) $45.45
D) $47.00

Correct Answer:

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