Question
a) Schnusenberg Corporation next dividend of D 1 = $0.75 per share, and that dividend is expected to grow at a constant rate of 6.50%
a) Schnusenberg Corporation next dividend of D 1 = $0.75 per share, and that dividend is expected to grow at a constant rate of 6.50% per year in the future. The company's required return is 14.7%. What is the company's current stock price?
| a. | $12.56 | |
| b. | $9.15 | |
| c. | $6.88 | |
| d. | $8.80 | |
| e. | $12.74 |
b) Huang Company's last dividend was $1.25. The dividend growth rate is expected to be constant at 27.5% for 3 years, after which dividends are expected to grow at a rate of 6% forever. If the firm's required return (r s) is 13%, what is its current stock price?
| a. | $54.54 | |
| b. | $31.99 | |
| c. | $36.35 | |
| d. | $45.14 | |
| e. | $41.99 |
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Entrepreneurial Finance
Authors: J. Chris Leach, Ronald W. Melicher
6th edition
1305968352, 978-1337635653, 978-1305968356
