You expect XYZ stock to pay a $4.50 dividend at the end of the year. The stock

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You expect XYZ stock to pay a $4.50 dividend at the end of the year. The stock price is expected to be $12 at that time. If you require a 15% rate of return, what would you pay for the stock now?

a. $14.35

b. $16.5

c. $19.41

d. $10.34

e. None of the listed choices is correct

Related Book For answer-question

Intermediate Financial Management

ISBN: 978-1285850030

12th edition

Authors: Eugene F. Brigham, Phillip R. Daves

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Posted Date: Jun 23, 2022 01:55 AM

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You expect XYZ stock to pay a $4.50 dividend at the end of the year. The stock

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Correct option is a 1435 Explanation 1 Given that the ... View the full answer

Intermediate Financial Management

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