Question
ABC Inc. currently pays an annual dividend of $3 per share on its common stock. As the company expands their business into the global market,
ABC Inc. currently pays an annual dividend of $3 per share on its common stock. As the company expands their business into the global market, they expect dividend to grow at a supernormal rate of 20% for the next three years. After that, the dividend is expected to grow at a normal rate of 5%. Assume the interest rate is 10%, what is the current stock price?
| A. | $75.25 | |
| B. | $86.33 | |
| C. | $89.66 | |
| D. | $92.53 |
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Behavioural Approaches To Corporate Governance
Authors: Cameron Elliott Gordon
1st Edition
1138611395, 978-1138611399
