The Bell Weather Co. is a new firm in a rapidly growing industry. The company is planning
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Question:
The Bell Weather Co. is a new firm in a rapidly growing industry. The company is planning on increasing its annual dividend by 16 percent a year for the next 4 years and then decreasing the growth rate to 4 percent per year. The company just paid its annual dividend in the amount of $2.30 per share. What is the current value of one share of this stock if the required rate of return is 7.80 percent?
(a). $113.97
(b). $95.49
(c). $84.40
(d). $97.79
(e). $116.27
Related Book For
Fundamentals of Financial Management
ISBN: 9780273713630
13th Revised edition
Authors: James van Horne, John Wachowicz
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