Solved

A Firm Has Experienced a Constant Annual Rate of Dividend

Question 163

Multiple Choice

A firm has experienced a constant annual rate of dividend growth of 9 percent on its common stock and expects the dividend per share in the coming year to be $2.70. The firm can earn 12 percent on similar risk involvements. The value of the firm's common stock is ________.


A) $22.50/share
B) $9/share
C) $90/share
D) $30/share

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q158: The common stock book value model ignores

Q159: If the risk-free rate decreases due to

Q160: The Oxford Heating Company has been very

Q161: Milton Glasses recently paid a dividend of

Q162: A firm has to pay a dividend

Q164: Table 7.1 <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB2929/.jpg" alt="Table 7.1

Q165: Treasury stock generally does not have voting

Q166: At year end, Tangshan China Company balance

Q167: Tina's Medical Equipment Company paid $2.25 common

Q168: The par value on a common stock