Brash Corporation initiated a new corporate strategy that fixes its annual dividend at $2.25 per share forever.

Question:

Brash Corporation initiated a new corporate strategy that fixes its annual dividend at $2.25 per share forever. If the risk-free rate is 4.5% and the risk premium on Brash’s stock is 10.8%, what is the value of Brash’s stock?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...