Question

Stormy Weather has no attractive investment opportunities. Its return on equity equals the discount rate, which is 10%. Its expected earnings this year are $4 per share. Find the stock price, P/E ratio, and growth rate of dividends for plowback ratios of
a. 0.00
b. 0.40
c. 0.80
Return on equity...... 10.00%
Discount rate....... 10.00%
Expected earnings per share. $4.00



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  • CreatedSeptember 19, 2013
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