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A Company Plans to Pay an Annual Dividend of

Question 43

Multiple Choice

A company plans to pay an annual dividend of $.30 a share for two years commencing two years from today.After that time,a constant $1 a share annual dividend is planned indefinitely.Given a required return of 14 percent,what is the current value of this stock?


A) $4.82
B) $5.25
C) $5.39
D) $5.46
E) $5.58

Correct Answer:

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