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3. The common stock of Company A pays an annual dividend of $1.65 a share. The company has promised to maintain a constant dividend even
3. The common stock of Company A pays an annual dividend of $1.65 a share. The company has promised to maintain a constant dividend even though economic times are tough. How much are you willing to pay for one share of this stock if you want to earn a 12 percent annual return?
4. Company B just paid an annual dividend of $0.95 per share. The company announced that future dividends will be increasing by 2.6 percent annually. If you require a 13 percent rate of return, how much are you willing to pay to purchase one share of this stock today?
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