Inmid-2015, Coca-Cola Company(KO) had a share price of $ 42.75, and had paid a dividend of $

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Inmid-2015, Coca-Cola Company(KO) had a share price of $ 42.75, and had paid a dividend of $ 1.45 for the prior year. Suppose you expectCoca-Cola to raise this dividend by approximately 6.9 % per year in perpetuity.

a. IfCoca-Cola's equity cost of capital is 8.5 % what share price would you expect based on your estimate of the dividend growthrate?

b. GivenCoca-Cola's shareprice, what would you conclude about your assessment ofCoca-Cola's future dividendgrowth?

Posted Date: May 19, 2024 12:01 PM

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Inmid-2015, Coca-Cola Company(KO) had a share price of $ 42.75, and had paid a dividend of $

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