Question

Your broker offers to sell you some shares of Wingler & Company common stock, which paid a dividend of $2 yesterday. You expect the dividend to grow at a rate of 5 percent per year into perpetuity. The appropriate rate of return for the stock is 12 percent.
a. If you purchase the Wingler & Company stock with the intent of selling it in three years, what cash flows will you receive each year?
b. What is the market value of Wingler’s stock?



$1.99
Sales2
Views463
Comments0
  • CreatedNovember 24, 2014
  • Files Included
Post your question
5000