Question: ABC corp s dividend grows at a constant rate indefinitely. ABC corp s discount rate is 8 % and its ROE is 5 % .

ABC corps dividend grows at a constant rate indefinitely. ABC corps discount rate is 8% and its ROE is 5%. Currently, ABC corp maintains a dividend policy with b=90%.(That is, the company pays out 10% of its earnings as dividends.) If ABCs year 1 earnings (E1) is $10, what is its stock price today?
Group of answer choices
$25.76
$30.54
$35.32
$28.57

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