Question: Problem 7 - 1 5 Constant - Growth Model ( LO 2 ) A stock sells for $ 4 0 . The next dividend will

Problem 7-15 Constant-Growth Model (LO2)
A stock sells for $40. The next dividend will be $4 per share. If the rate of return earned on reinvested find 10%
and the company reinvests a constant 40% of earnings in the firm, what must be the discount rate?
Note: Do not round your intermediate calculations. Enter your answer as a whole percent.
Problem 7-15 Constant-Growth Model (LO2) A stock sells for $40. The

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