J. Pinkman Motors, Inc., paid a $3.75 dividend last year. If J. Pinkman's return on equity is

Question:

J. Pinkman Motors, Inc., paid a $3.75 last year. If J. Pinkman's return on equity is 24 percent and its retention rate is 25 percent, what is the value of the if the investors require a 20 percent rate of return?
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...