Question: Problem 7-12 Stock Valuation [LO 1] Cape Corp. will pay a dividend of $4.50 next year. The company has stated that it will maintain a
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Problem 7-12 Stock Valuation [LO 1] Cape Corp. will pay a dividend of $4.50 next year. The company has stated that it will maintain a constant growth rate of 5.25 percent a year forever. Book a. If you want a return of 18 percent, how much will you pay for the stock? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. If you want a return of 11 percent, how much will you pay for the stock? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Print ferences 8. Stock price b. Stock price
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