Asked by
peyton schumann
on Dec 09, 2024
Verified
ABC Corporation has just paid a $4 dividend. Dividend growth rate has been at 3% and expected to be so into the future. If investor's return is 12%, calculate the stock price now.
A) $45.78
B) $46.08
C) $47.58
D) $48.08
E) $49.58
Dividend Growth Rate
The annual percentage rate of growth of a company’s dividend payments to shareholders.
Investor's Return
The positive or negative shift in an investment's financial value during a set interval, portrayed as a percentage of the investment's initial price.
Stock Price
The cost of purchasing a share of a company's stock, determined by the supply and demand for it in the market.
- Gain an understanding of and put into practice the dividend discount model when assessing the worth of stocks.
Verified Answer
HO
Learning Objectives
- Gain an understanding of and put into practice the dividend discount model when assessing the worth of stocks.