Question
A stock pays dividends of $1.00 at t = 1 ( t = 1 NOT t = 0 ). Dividends are expected to grow at
A stock pays dividends of $1.00 at t = 1 (t = 1 NOT t = 0). Dividends are expected to grow at a constant rate of 16% into the future. With a discount rate of26%, what should the price of the stock be at t = 1? (price needed for t =1 NOT t = 0) (hint: there is more than one way to do this problem)
| $11.20 | ||
| $11.40 | ||
| $11.60 | ||
| $11.80 | ||
| $12.00 |
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Dividend Investing
Authors: John Swing
1st Edition
1700003968, 978-1700003966
