Pasqually Mineral Water, Inc , will pay a quarterly dividend per share of $ 80 at the end of each of the next 12 quarters Thereafter, the dividend will grow at a quarterly rate of 1 percent, forever The appropriate rate of return on the stock is 10 percent, compounded quarterly What is the current ...

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Pasqually Mineral Water, Inc., will pay a quarterly dividend per share of $.80 at the end of

Question:

Pasqually Mineral Water, Inc., will pay a quarterly per share of $.80 at the end of each of the next 12 quarters. Thereafter, the will grow at a quarterly rate of 1 percent, forever. The appropriate rate of return on the stock is 10 percent, compounded quarterly. What is the current stock price?

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...