Common stock value-Constant growth Zina Telephone has paid the dividends shown in the following table over the

Question:

value-Constant growth Zina Telephone has paid the dividends shown in the following table over the past 6 years.
Year..........................Dividend per share
2012......................................US$2.87
2011...........................................2.76
2010...........................................2.60
2009...........................................2.46
2008...........................................2.37
2007...........................................2.25
The firm's per share next year is expected to be US$3.02.
a. If you can earn 13 percent on similar-risk investments, what is the most you would be willing to pay per share?
b. If you can earn only 10 percent on similar-risk investments, what is the most you would be willing to pay per share?
c. Compare and contrast your findings in parts a and b, and discuss the impact of changing risk on share value.
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...